Hyderabad | A major money circulation racket operating under the guise of multi-level marketing and investment schemes has been busted, with 32 individuals arrested. The accused allegedly lured people with promises of earning crores in a short period, convincing them to invest between ₹5 lakh and ₹10 lakh, and then routing the money through an illegal chain-based system.
Among those arrested are Rohith Kumar, Sandeep Reddy and several others, including 11 women. Investigations have revealed that many members of the network were either working in software companies or were former IT professionals, using their professional background to gain the trust of potential victims.
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According to findings, the accused primarily targeted software employees, unemployed youth, small business owners and homemakers. Victims were invited to meetings under the pretext of part-time jobs or online business opportunities, where they were shown lucrative income prospects. These meetings were often held in hotels in the Hitec City area to create an impression of legitimacy and professionalism.
Victims were told that an investment of ₹5 lakh to ₹10 lakh could yield returns of ₹3 crore to ₹4 crore within two years. They were also encouraged to purchase products presented as “gifts” or “packages.” However, it is alleged that the invested money was directly funneled into the money circulation scheme without the investors’ knowledge.
The investigation further revealed that the network operated on a binary model, where each participant was required to recruit at least two new members. This created a growing chain structure, with those at higher levels earning commissions from the investments of new recruits. Officials stated that such a structure qualifies as an illegal money circulation scheme, which is prohibited under the law.
So far, statements from 11 victims have been recorded, reporting combined losses of around ₹75 lakh. However, investigators believe the number of affected individuals could be significantly higher, as many victims are yet to come forward.
The case is believed to be part of a larger nationwide network, with suspected transactions running into thousands of crores. The accused allegedly presented themselves as being associated with legitimate e-commerce and travel package businesses, while their actual objective was to recruit members and collect money into the scheme.
Simultaneous raids were conducted at multiple locations, uncovering links of the network across different states. Efforts are currently underway to trace absconding accused, and a detailed probe into the financial transactions of the network is ongoing.
Authorities have urged the public to remain cautious of schemes that promise unusually high returns in a short time. Experts note that if earnings in a scheme depend primarily on enrolling new members, it is often a strong indicator of fraud.
The crackdown once again highlights the growing sophistication of digital and network-based frauds, where professional appearances and structured presentations are used to trap individuals. In such a scenario, thorough verification and due diligence before investing have become more important than ever.
