Police and district administration officials in Karnataka’s Belagavi district have arrested Shivanand Neelannavar, owner of the private investment firm Shivam Associates, after allegations surfaced that the firm raised funds from thousands of investors without mandatory approvals from the Reserve Bank of India or the Securities and Exchange Board of India. Authorities suspect nearly 35,000 investors may be linked to the firm, though the final scale of the case will be determined after a detailed audit.
Probe Finds Suspicious Transactions
According to Police Commissioner Borase Bhushan Gulabrao, the case came to light after the district administration and police began an internal inquiry into the firm’s financial activities. The inquiry reportedly revealed suspicious transactions and documents linked to investment schemes.
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Following the findings, a formal complaint was filed at Malmaruti Police Station, leading to action against the accused. Officials said the case is being treated as a possible multi-crore financial scam, but the exact amount involved is still under verification.
Investigators said the firm allegedly collected money from the public under various investment plans without regulatory approval. Preliminary findings suggest that investors were promised assured returns and safe investment opportunities, raising questions over the legality and structure of the schemes.
Documents and Devices Seized
Belagavi Assistant Commissioner Shravan Nayak said a joint team from the revenue department, cooperative societies department and police conducted a raid at the premises of Shivam Associates on the directions of the district administration.
During the search, officials seized several documents, computer systems and laptops. Authorities said the seized material revealed suspicious financial records and will now be examined as part of the investigation.
Officials also said the firm was allegedly accepting funds in the form of unsecured loans and investments without formal contracts or regulatory compliance. This has brought the operation under closer scrutiny for possible financial irregularities.
Case Filed Under KPID and BUDS Acts
The case has been registered under the Karnataka Protection of Interest of Depositors in Financial Establishments Act and the BUDS Act. Officials said these laws allow action, including attachment of properties, to protect the interests of depositors.
The accused is currently in custody and is being interrogated. Police are expected to seek judicial and custodial remand for further investigation, while a forensic audit of financial records and transactions has been initiated.
Authorities said the probe may not remain limited to one individual, and the possibility of a wider network behind the alleged scam is being examined. Investigators are now tracing investor lists and following the money trail to determine the full extent of the operation.
