EOW nabs Ponzi firm state head

Bhubaneswar: The Economic Offences Wing (EOW) of the Crime Branch claimed to have arrested the Odisha head of ‘Hedgex Fund’, a firm accused of duping around three lakh depositors in 10 states to a tune of over Rs 1,000 crore on the promise of hefty returns, from Cuttack Saturday.

Pratap Kumar Rout has been booked under Sections 420, 467, 468, 471, and 120-B of the IPC, 4, 5, and 6 of the Prize Chits and Money Circulation Schemes (Banning) Act, 66(D) of the Information Technology Act, and 21(1)(3) and 23 of the Banning of Unregulated Deposit Schemes Act, the investigating agency said in a media statement.

The case was registered on the basis of a complaint filed by Bijay Kumar Panigrahy, who alleged that he invested Rs 92.6 lakh in ‘Hedgex Fund’, whose designated partners include Dinesh Kumar Jain.

Rout persuaded Panigrahy to invest his retirement savings in ‘Hedgex Fund’ by promising monthly returns ranging from 11 per cent to 18 per cent. After a few months, the company stopped operations, blocking investors’ funds, it said.

“Rout, as the Odisha coordinator, operated multiple bank accounts. He collected funds in cash and through ‘hawala’ channels, and organised promotional meetings in Cuttack and Bhubaneswar to attract more investors,” the EOW said.

According to the EOW, the fraud followed a Ponzi scheme model, initially offering small periodic returns to gain investor trust before abruptly shutting down operations and disappearing with public money.

“Preliminary investigation revealed that ‘Hedgex Fund’ was registered with the Registrar of Companies, Goa, in 2023.

But its network spread across 10 states, including Andhra Pradesh, West Bengal, Assam, Madhya Pradesh, Uttar Pradesh, Rajasthan, Gujarat, Tamil Nadu and Odisha, affecting over three lakh depositors,” the EOW said.

The total amount defrauded is estimated to exceed Rs 1,000 crore. The company also floated several sister concerns, including Kaushalaya Foundation, Lavya World, Frix Market, and Lavya International, between 2023 and 2024 to deceive investors, it added.

Rout and other top members allegedly used multiple mule and third-party accounts to conceal transactions and mislead enforcement agencies.

The EOW has recovered several incriminating documents from Rout’s possession.

 

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