Hyderabad: IIT dropouts held for fraud

Hyderabad: The Economic Offences Wing of the Cyberabad police on Saturday arrested nine men, including dropouts from IIT Kharagpur, for their involvement in a multi-level marketing money circulation scheme that cheated people of nearly Rs 30 cr.

According to Cyberabad Police Commissioner, Mr V.C. Sajjanar, the men were running ‘Pro Healthywayz International LLP’, located at Malakpet Gunj and cheating investors by offering prize chits and money circulation schemes.

Those arrested included company CEO Mohammed Rizwan and directors Bhattu Saikonda Harshavardhan Raju, 27 and Mohd Ishaq, 61. 

Police seized 40 lakhs from the bank accounts of the accused.

The arrested included four IIT Kharagpur dropouts Rizwan Younus, Pappala Sai Charan, 24, Vankudothu Venu Naik, 26, and Bhukya Anil Kumar, 26. Police also arrested Mohd Ishaq, 61, Aluru Naresh, 27, and Yerraganti Sathya Manikanta, 24.

“They had previously worked in Resource Money Power (RMP), an MLM company which was shut down in 2010. Then they joined (MI) Life Style Marketing Pvt. Ltd at Chennai, where they worked for two years. As they did not get the commissions in time and the products were not of good quality, they quit the company. With that experience they thought of launching their own MLM money circulation company, funded by Rizwan Younus,” Mr Sajjanar said.

He said the company had about 40,000 distributors in the two Telugu states. Each distributor had to pay Rs 4,000 after which they are required to attract more members.

Mr Sajjanar said the the recruits had to attend meetings to get acquainted with the money circulation scheme. They had to enrol two more persons for which they would get 25 per cent commission. The two new members were required to enrol two more members, and the first recruiter would get per cent commission from this.

Mr Sajjanar said Rizwan took the help of Ashish Khatri, Logic Soft, Dehradun, who designed a software for the company. Ashish Khatri had worked for eight months with the company. Later, with the help of CEO Kishore Verma of Smart Soft Solutions, the company's official website was redesigned.