Torres Ponzi scheme fraud: How 1.25 lakh investors from Mumbai, Navi Mumbai were defrauded of over Rs 1,000 crore

On Tuesday, the Shivaji Park police arrested company’s general manager Taniya Xasatova alias Tazagul Karaxanovna Xasatova, 52, director Sarvesh Ashok Surve, 30, and store in-charge Valentina Ganesh Kumar, 44.

Taniya is an Uzbekistan national, while Valentina is a Russian origin overseas citizen of India as she married an Indian. Surve who is an aadhar card operator was made the ‘on-paper’ director of the company. All three were produced in the MPID court and were remanded to police custody up to January 13.

The police informed the court that the accused company had no permission from the RBI or from any other government body to accept investments. “They commited the financial crime in a well planned and organised manner,” inspector Yuvraj Sarnobat informed the court.

Company founders John Carter and Victoria Kowlenko are suspected to be the masterminds behind the alleged mass fraud and are suspected to have fled the country. They are among a few others who are wanted accused in the case, said a police officer.

Due to the bonus interest in cash investments, many people invested in cash and now worry if police will be able to recover their cash investment in the fraud amount. (Express Photo)

DCP Zone 5 Ganesh Gawade said, “We have arrested three people and got LOCs issued against two foreigners suspects. We are in the process of transferring the matter to EOW.”

So far the police have included names of 61 investors in the FIR claiming that they lost Rs 13.48 crore. The FIR was filed on the complaint of vegetable vendor Khar Pradipkumar Vaishya, 31 who along with his relatives lost Rs 4.5 crore to the fraud.

Police have seized nearly Rs 28 lakh cash from the Dadar store of Torres and frozen around Rs 4 crore in three bank accounts.

Police sources said that the company stores and officers were on rented place. Cops would soon start identifying company’s assets, if any, to recover investors money.

The ponzi schemes

According to Shivaji Park police officials, the alleged Ponzi scheme was floated in Mumbai Metropolitan Region (MMR) through their six swanky showrooms including Dadar, Grant Road, Kandivali, Mira Road, Kalyan and Sanpada around February this year.

According to the victims, the accused company conducted large seminars across the city and attracted investors by floating lucrative investment schemes, offering unbelievable returns.

“The company mainly floated four schemes; invest in gold for a weekly interest of 2%, silver for interest of 3%, Moissanite stones in silver for 4%  interest and investments only in Moissanite stones for an interest of 5-6%,” said Geeta Gupta, an widower from Sweri, who along with her relatives lost nearly Rs 15 lakh.

According to the victims, the accused company conducted large seminars across the city and attracted investors by floating lucrative investment schemes, offering unbelievable returns. (Express Photo)

The scheme operators gradually increased the interest rate towards the end of the year to extract more money from the investors. They asked people to invest in cash to get a weekly interest of 11.5 % if invested in cash. And if any investors bring new investors, then the person would get a 20% interest on investment for referral, Gupta added.

Due to the bonus interest in cash investments, many people invested in cash and now worry if police will be able to recover their cash investment in the fraud amount.

“To make investors trust them, the senior executives while conducting seminars would say that they get gold at a cheaper rate and they make a 300% profit on it. From this 300% profit they are able to give these unbelievable returns to the investors. This convinced investors and they made huge investments,” said one such investor, Salim Ansari.

“Initially people invested money and after getting timely returns they invested more and also encouraged their family members, relatives, friends etc. There are investors who were operating like agents, as they brought dozens of investors to the company, and were earning the referral bonus/interest. Eventually they too lost all their money,” said a police officer part of the probe.

Fake robbery scenes

Preliminary police inquiry has revealed that the accused company had already planned to close all their branches on January 1 and go into hiding. As per their plans they had closed all their branches in Mumbai except the one at Dadar West. They were in preparation to close this branch too on Monday but their plan failed. After Monday’s protests by investors outside the Torres’ showroom, they started getting messages from Torres, claiming it was a few rogue employees of the company that committed the fraud and robbed also the company stores in Sanpada. The company also floated certain forms among victim investors telling them to fill it up to get back their money. However, the police said that it was all part of their escape plan. The robbery was staged and captured in their CCTV footage. A fake robbery scene was created to buy more time to wind up everything and run away, said an officer from Shivaji Park police.

Mortgaged jewellery, took loans to invest

Seeing unrealistic weekly interests, hundreds of investors invested money in the ponzi schemes. Powai based Kalpana Kadam said that she and her family lost Rs 43 lakh to the fraud scheme. “Me, my mother and family members broke our fixed deposits, mortgaged ornaments and invested money. My husband wasn’t aware of this. On Tuesday he discovered it when the news reports were everywhere about the company,” Kadam said.

Devndera Singh, 35, a security guard from Kurla said, “I have invested Rs 3.5 lakh in November and to arrange the money, I mortgaged my wife’s jewellery without letting her know.”

Similarly, an investor Shailaja Shinde, 50, from Diva, who invested Rs 3 lakh into the scheme, said, “The fraud scheme has brought to us into a situation where we feel committing suicide.”

BJP leader Kirit Somaiya visited the Torres store on Tuesday, and met investors. He said, “It seems the scam could cross Rs 1,000 crore. I discussed the issue with senior officials of the economic offence wing of Mumbai Police.”