EOW arrests member of gang that dematerialised shares worth crores of dead

Chetan Shah is associated with a gang that used to find people who hadn’t claimed dividends on their shares for long and hadn’t dematerialised them. The gang then impersonated these shareholders, most of whom were dead, to open demat accounts in their names and encashed their shares

MUMBAI: The Economic Offences Wing (EOW) of the Mumbai Police has arrested a 61-year-old man for allegedly defrauding several shareholders of ₹2.88 crore. The arrested accused was identified as Chetan Bhupendra Shah, 61, a resident of Vasant Valley, Goregaon East.

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Shah is associated with a gang that used to find people who hadn’t claimed dividends on their shares for long and hadn’t dematerialised them, according to the police. The gang then impersonated these shareholders, most of whom were dead, to open demat accounts in their names with forged documents and encashed their shares.

“We suspect it is an organised gang,” said a police officer. “Till now, we have found they have withdrawn shares worth ₹14 crore owned by 18 people. The fraud took place from 2014 to 2019, when the process of dematerialisation of shares was in process. Most of their victims have died, and their heirs are not aware of their investments.”

The police had earlier arrested three other gang members: Arvind Goyal on December 22 last year, Ashish Shah on January 17, and Manish Shah in February this year. The complainant in the case is Kunal Kothari, senior vice-president of J M Financial Services, a Mumbai-based investment banking firm. The accused had withdrawn shares from the company.

According to the police, the accused used to find people who had not claimed dividends on their shares, and the shares had not been dematerialised. They then used to get basic information about them by visiting their premises. If they found the shareholders had died, they used to obtain the death certificates somehow and forge other documents, open demat accounts in their names, and then encash shares.

The FIR in this case was initially filed at the Kasturba Marg police station but was later transferred to the EOW due to the substantial amount involved.