Bhavnagar (Gujarat): An alleged investment fraud in Gujarat’s Bhavnagar district has expanded into what investigators believe could be a major financial scam. Police allege that two cousins lured investors by promising 20% returns on stock market investments, collected large sums of money, and later absconded. While the complaints officially registered so far involve about ₹1.29 crore, several alleged victims claim the actual fraud could be worth between ₹300 crore and ₹400 crore. Police are currently verifying these claims.
The accused have been identified as Yogesh Dhamecha and Sanjay Dhamecha. According to the Local Crime Branch (LCB), both are in police remand until July 13 and are being questioned in detail. Investigators are examining how the alleged investment network operated and whether additional individuals were involved in the scheme.
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According to the investigation, the accused allegedly used money collected from new investors to pay the promised 20% returns to earlier investors, thereby building confidence and attracting more participants. Police suspect this model enabled the accused to mobilise substantial funds before they allegedly disappeared.
Officials said the case initially began with complaints from seven investors involving approximately ₹1.03 crore. During the investigation, eight more complaints were received, increasing the total complaint amount to nearly ₹1.29 crore. Since then, around 100 people have approached the police with documents claiming they invested money in the alleged scheme.
Investigators are also examining the accused’s activities, financial dealings, communications and the extent of the alleged investment network. Police said the probe is being conducted on the basis of documentary and digital evidence, and legal action will be taken against any person found to have played a role in the alleged fraud.
Several social workers and alleged victims claim the investment network operated across 30 to 35 villages through nearly 100 to 150 agents. Some agents have stated that they were shown stamp paper documents to establish credibility before they persuaded others to invest. A number of agents have also claimed that they personally lost several lakh rupees in the scheme.
Police are analysing the alleged money trail, bank accounts, investment records, agent network and documents submitted by investors. The objective is to determine the total amount collected, trace the movement of funds and identify all individuals who may have been involved in the alleged investment fraud.
According to the Future Crime Research Foundation (FCRF), Ponzi and high-return investment frauds typically rely on unrealistic profit promises, agent-based marketing networks and the use of new investors’ money to pay returns to earlier participants. Investors should deal only with investment products regulated by the Securities and Exchange Board of India (SEBI), remain cautious of unusually high return promises, and independently verify the legitimacy of any investment scheme before investing.
The investigation remains ongoing. Police said statements of additional complainants are being recorded, documentary evidence is being collected, and further legal action will be taken based on the findings of the investigation. Authorities are also working to determine the actual size of the alleged fraud, trace the flow of funds, and establish the role of every individual connected with the case.
