Follow us on Google News
A Gujarat-based digital wallet scheme allegedly defrauded investors of over Rs 1,200 crore, with 18 FIRs filed thus far.
Police investigating the alleged SD Pay investment fraud have arrested 12 accused and identified a network spanning several states. The scheme, promoted through a digital wallet application developed by a Gujarat-based startup, attracted investors by promising unusually high daily returns, referral commissions and other financial benefits. Investigators believe the operation functioned as a multi-level marketing scheme in which payments to earlier investors came from money deposited by new participants.
How Did the SD Pay Investment Scheme Operate?
SD Pay, also known as Apna Pay, was launched in 2024 by Dhaval Patel, identified by investigators as the principal accused. The application initially promised to simplify bill payments and mobile recharges while offering attractive monetary returns.
According to police, investors were promised daily interest ranging from 0.15% to 0.30%, depending on their investment amounts. The accused subsequently introduced referral cashback incentives after the application failed to attract substantial investments through its initial offers.
The referral structure allegedly offered commissions ranging from 30% at the first level to 3% at levels 10 to 15. Investigators said seminars, online meetings and marketing campaigns encouraged participants to recruit additional investors.
Police alleged that seven companies associated with the operation generated no substantial value through products or services. Instead, funds collected from new investors were used to pay earlier participants.
How Were Investors Drawn Into the Network?
A 48-year-old teacher from Vadodara invested ₹9.5 lakh from the proceeds of selling her apartment in 2025. Her digital wallet displayed approximately ₹50 lakh by mid-2026, but she could not withdraw the money after the application stopped functioning.
The teacher said promoters initially gained her confidence through documents and a signed blank cheque. She subsequently encouraged 31 relatives and colleagues to invest. Eleven family members invested ₹30 lakh collectively, while 20 colleagues contributed another ₹12 lakh.
She later discovered that approximately 800 people had joined through referrals originating from her network.
In another case, a Surendranagar resident reportedly invested ₹60 lakh, including money obtained through personal and gold loans, hoping to purchase a house using the promised returns.
Investigators also identified a Surat investor who allegedly turned an initial ₹1,000 investment into ₹1 crore and developed a referral network involving approximately 1.6 lakh investors.
What Triggered the Police Investigation?
Problems emerged in March 2026 when investors stopped receiving the promised daily returns. By that time, the accused had allegedly begun offering company shares instead of repayment.
Police said investors were told that the company would eventually launch an initial public offering. Some were allegedly pressured to accept shares at a notional valuation of ₹20 each.
The investigation began following a complaint lodged on June 6 by a computer operator from Savarkundla who alleged cheating involving ₹2 lakh. Although the money was refunded and the complaint withdrawn, police continued examining the transactions.
Investigators subsequently discovered suspicious transfers involving a Yes Bank account held by Shiv Dharti Communication Private Limited. They also identified complaints from other states and an earlier FIR registered in Gujarat in September 2025.
On September 2, 2026, Amreli Cybercrime Police registered a case after receiving a complaint from a policeman’s wife who alleged losing ₹10 lakh.
What Have Investigators Discovered About the Money?
Investigators found that more than 15 lakh users had downloaded and used SD Pay. Approximately 6.52 lakh bank accounts were associated with transactions involving ₹1,211 crore.
Police suspect the financial trail is considerably more complicated because some agents allegedly collected cash deposits without maintaining corresponding banking records.
By October 31, 876 victims had approached Amreli Police, reporting combined losses of ₹37.42 crore. Authorities had identified approximately 95 important agents operating across several states.
Investigators also traced 38 bank accounts associated with six companies and another 72 accounts operated by 16 company directors.
Despite the scale of the alleged fraud, seizures had reached only ₹1.86 crore. Police were examining immovable properties belonging to the accused for possible attachment.
What Action Has Been Taken Against the Accused?
Police have arrested 12 people in connection with the investigation, including alleged promoters Dhaval Patel and Hiren Shah. Other accused remain absconding.
Cases have been registered under provisions relating to cheating and criminal conspiracy, alongside laws governing unregulated deposit schemes, financial establishments, prize chits and information technology.
Seven arrested accused sought bail, but their applications were rejected by the special court dealing with cases under the Banning of Unregulated Deposit Schemes Act.
Investigators have identified at least 18 FIRs across Gujarat, Rajasthan, Maharashtra and Tamil Nadu.
Police also secured the removal of the application from the Google Play Store and contacted the Reserve Bank of India.
The investigation continues as authorities attempt to trace the remaining funds, identify beneficiaries and distinguish investors who suffered losses from participants who actively recruited others into the alleged scheme.
