The Enforcement Directorate (ED) on Monday attached assets worth Rs 207 crore of a Pune-based firm, Samruddha Jeevan Foods India Ltd and its promoter, who allegedly ran a ponzi scheme and raised over Rs 3,500 crore from at least 20 lakh investors. The ED in a statement said the funds generated through the ponzi scheme was “laundered for expansion of other businesses like construction, media, hospitality, software, etc and for personal comforts”.
The ED has found that Mahesh Kisan Motewar and his firm collected money from investors and allegedly laundered it through 34 group companies. This money, according to the ED, was used to “acquire immovable properties ranging from plots/lands, commercial complex, hotels, resorts, flats, bungalows and movable properties”. “The CID, Pune, in its chargesheet found that accused Motewar, chief managing director of Samruddha Jeevan, and his two wives with others have been engaged in the offence of criminal conspiracy and cheating whereby more than 20 lakh small investors across India have been attracted through their livestock business schemes like rearing, sale and purchase of livestocks. They lured people to invest money by falsely promising unreasonably high returns and generated funds more than Rs 3,500 crore,” said the ED statement.
The ED, which is investigating the case under the stringent Prevention of Money Laundering Act (PMLA), has attached immovable properties of the firm and its promoter worth Rs 203.55 crore and a helicopter parked at the Juhu airport in Mumbai worth Rs 3.43 crore. “Properties were purchased in the name of the main company and many of its associated companies like Prosperity Agro India Ltd, Samruddha Jeevan Multistate Multipurpose Co-op. Society Ltd, Samruddha Jeevan Constructions Pvt. Ltd., Jeevan Jyoti Construction Pvt. Ltd.,” read the ED statement.
The properties attached by the ED include plots in Jalgaon, Pune, Solapur, Ratnagiri, shops in Akola, Amaravati, Chalisgaon, Jintur, Pandharpur, Nashik, Chandrapur, Sangamner, Usmanabad, Nagpur, Aurangabad, Mapusa in Goa, Lucknow in Uttar Pradesh among others. The ED has also attached two hotels — Hotel Orchard and Hotel Le Royale Residency — in Pune allegedly run by the Motewar family.
“During investigation under PMLA, it was revealed that the company has obtained huge amount of money as deposits from investors which was neither refunded nor interest or assured returns on the investments were made. Thus the entire activity of rearing, sale and purchase of livestock and other business activity was nothing but a smokescreen to collect huge funds from lakhs of investors mainly in cash,” the statement read.
In 2013, the Securities and Exchange Board of India (SEBI) had barred the directors of Samruddha Jeevan from raising money from its investors. The company had been collecting money from small investors, majority of whom are from rural and semi-urban areas, with promises of huge returns from cattle and goat farms. SEBI board had found that besides facing several allegations of malpractices, the company was running the scheme without a proper approval, which was mandatory.