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The Hyderabad police on Wednesday, October 12, said that they have busted a Chinese investment fraud of Rs 903 crore and arrested 10 accused, including a Chinese national and a Taiwanese national. The cyber crime cell of the city police busted the fraud during investigation into a complaint by a citizen, who said he was cheated after he invested Rs 1.6 lakh in an investment app called LOXAM.
Upon investigation, it was found that the money of the complainant was deposited in an IndusInd bank account in the name of Xindai Technologies Pvt Ltd. Further investigations revealed the scam. Hyderabad Police Commissioner CV Anand said that money changers licensed by the Reserve Bank of India (RBI) to deal in foreign exchange were involved in the scam as well. Though they were given a licence to provide foreign exchange to those travelling abroad, they were found to be violating the Foreign Exchange Management Act (FEMA). Chinese national Lec alias Li Zhongjun and Taiwanese national Chu Chun-yu have been arrested along with eight others for running the hawala scam from Delhi and Mumbai. The other accused include Sahil Bajaj, Sunny alias Pankaj, Virender Singh, Sanjay Yadav, Navneet Kaushik, Mohammad Parvez, Syed Sultan, and Mirza Nadeem Baig are the others arrested.
According to the police, Navneet Kaushik, a resident of Delhi, had last year obtained RBI licenses for two money exchanges — Ranjan Money Corp Pvt Ltd and KDS Forex Pvt Ltd. The police investigations revealed that the transactions in the account of Ranjan Money are to the tune of Rs 441 crore in a period of seven months. Transactions of another Rs 462 crore were done by KDS Forex. "It has come to light during the investigation that fraud has been committed through hawala to the extent of 903 crore rupees," Anand said. The Police Commissioner revealed that so far, Rs 1.91 crore has been frozen in various bank accounts in this case.
When Virender Singh of Pune was arrested as part of the investigation into the complaint from a victim and was interrogated, he revealed that he opened a bank account in the name of Xindai Technologies Pvt Ltd on the orders of the Chinese national, and gave the internet banking user name and password of the bank account to him.
During investigation it came to light that the bank account of Betench Networks Pvt Ltd, and Xindai Technologies Pvt Ltd share the same phone number. Sanjay Kumar of Delhi opened the account of Betench on the instructions of Lec alias Li Zhounjau and gave it to Pei and Huan Zhuan in China. Similarly, he opened 15 other bank accounts and sent them to Chu Chun-yu of Taiwan who is temporarily residing in Mumbai and was arrested in Mumbai on Tuesday. He was sending account details, user ID, password and SIM cards to other countries.
Police found that the money was transferred from the account of Xindai Technologies Pvt Ltd to 38 other bank accounts. It also went to the bank accounts of Hyderabad-based Sultan and Baig. They opened bank current accounts for the sake of commission as per instructions of Parvez. Parvez in turn gave those bank accounts to Imran who resides in Dubai. Imran along with others used these two bank accounts for Investment frauds.
A large amount of money from the 38 accounts of Xindai Technologies Pvt Ltd went to Ranjan Money Corp and KDS Forex Pvt Ltd. Kaushik, in turn, was sending the money received in the bank account to the forex exchanges run in the name of international tours and travels. He was converting the money received in rupees to US dollars in cash and giving it to Sahil and Sunny.
Police said Sahil and Sunny had joined hands with other fraudsters and transferred the money abroad through hawala.