ED freezes ₹32 crore in bank funds, seizes ₹70 lakh in cash
The Enforcement Directorate (ED) has frozen ₹32 crore in bank funds and seized ₹70 lakh in cash during searches in Maharashtra, Chhattisgarh, and Kerala as part of a money-laundering probe against HighRich Online Group
MUMBAI: The Enforcement Directorate (ED) has frozen ₹32 crore in bank funds and seized ₹70 lakh in cash during searches in Maharashtra, Chhattisgarh, and Kerala as part of a money-laundering probe against HighRich Online Group. The firm is allegedly involved in cryptocurrency trading and Ponzi-type marketing schemes.
The agency estimates that around ₹1,500 crore was collected from investors in the multi-level marketing scheme. The searches, conducted at 14 locations, also traced further proceeds of crime worth ₹15 crore. The frozen funds belonged to the firm, its promoters, and their family members. Apart from the cash of ₹70 lakh, jewellery and four four-wheelers were also seized.
ED found that the company, its promoters, and leaders were involved in trading cryptocurrency and selling their own crypto coin, HR Crypto Coin, which was part of a Ponzi scheme promising 15% annual returns and a 30% incentive for recruiting new investors.
The investigation, prompted by multiple complaints, revealed that the company sold memberships in the form of digital IDs, which members resold for commissions. “There is no real underlying business of sale of goods. This is the typical modus operandi of a Ponzi scheme,” an ED source said. Around ₹250 crore of the collected money was redistributed as rewards, while the rest was diverted by the promoters, KD Prathapan and Sreena Prathapan, through family members and various entities.
Earlier in January, ED searched the premises of HighRich Smartech Pvt. Ltd., HighRich Online Shoppe Pvt. Ltd., and associated companies, tracing and freezing ₹212 crore in alleged proceeds of crime. The total frozen/seized amount in the case is now ₹260 crore.