NALGONDA, TELANGANA: A 26-year-old man in Telangana is accused of defrauding hundreds of people out of an estimated ₹50 crore by promising unbelievably high monthly returns, creating a deep financial crisis in rural communities.
The Lure of Unusually High Returns
The accused, Ramavat Balaji Nayak, a 26-year-old college dropout from Nalgonda district, had a troubled start in business. After failing to complete his graduation and suffering losses with an ice cream parlor, he turned to real estate. According to police reports, it was here that he began borrowing money from locals with an enticing, yet financially impossible, offer: an unusually high monthly interest rate of up to ₹10 for every ₹100 invested. This translates to a shocking 10% return per month. To gain trust, Nayak reportedly paid interest to early investors, using their successful payouts as a lure to draw in others, a classic characteristic of a Ponzi scheme.
Building the Network and Spending the Spoils
As his credibility grew, Nayak expanded his operations by recruiting agents, often relatives and acquaintances, to collect deposits from residents in several surrounding villages. Investors were given promissory notes to formalize the agreement. With the money flooding in, Nayak quickly amassed a staggering ₹50 crore. He used these funds to buy luxury items and properties, including expensive cars, villas, and land across the region. However, he also gambled significant amounts, investing approximately ₹2.3 crore in risky ventures like wine shop permits, the stock market’s futures and options segment, and software companies.
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The Scheme’s Inevitable Collapse
The financial network built on impossibly high returns was unsustainable, and Nayak’s risky investments compounded the problems, leading to heavy losses. When he could no longer keep up with the promised interest payments, his entire operation began to crumble. He stopped paying investors, prompting victims to begin demanding their money back. When residents, realizing they had been cheated, eventually attacked his home, Nayak fled. The police registered multiple cases against him under the Bharatiya Nyaya Sanhita and the Telangana Protection of Depositors of Financial Establishments Act.
Police Action and Recovery Efforts
Following a thorough investigation, the Nalgonda district police successfully Arrested over the weekend. Law enforcement officials have so far identified 106 victims in the case, though the number is expected to rise. The police have taken steps to recover the stolen funds, seizing assets that include two SUVs worth ₹80 lakh, several property documents, and both signed and blank promissory notes. Special police teams are currently working to trace any benami assets—properties held under false names—to recover the maximum amount of money for the hundreds of affected victims through court proceedings.
