Pune: How Selva Nadar’s ‘highly profitable’ businesses were a bundle of lies

Visits by The Indian Express to venues of some of the ‘highly profitable” businesses that Selva Nadar listed on Ashtavinayak Investment’s website and actively used to receive funds from ‘profile investors’ reveal that they either do not exist or were defunct long before Nadar fled the city by shutting down his office.

Nadar and his staff claimed to the investors that the firm was investing their funds in businesses including Ashtavinayak Gold Jewellery stores, Ashtavinayak Hostels, Ashtavinayak Training Academy apart from Ashtavinayak Investment’s dealings in commodity and stock markets.

They were told that these were highly profitable businesses and the profit made by the firm will be shared with them at agreed upon rates at the end of the contract term. His clients have invested funds ranging from Rs 6 lakh to Rs 1.2 crore, mostly by taking non-secured personal loans from banks with mediation by Selva’s firm.

The Ashtavinayak website mentions two locations — Kharadi and New Sangvi — as locations for its gold jewellery shops. It also shared roadside views of these shops with the clients in the process of acquiring them as ‘profile investors’. The Indian Express found an ‘Ashtavinayak Gold’ store at the New Sangvi address – Manas Building, Katepuram Chowk – but the neighbours and the landlord pointed out that it was not a ‘business’ in the general sense of the term.

“They rented the store a few months before the Covid-19 lockdown and got the furniture for the jewellery shop done. But it had no jewellery on display. Even later after the lockdown eased, a young man would open the shop and sit but I never saw any customer visiting the shop as it had no jewellery to do business. It has not opened for two months now,” said a shop owner from the neighbourhood.

The Kharadi store for which the website gives no specific address, couldn’t be traced online or offline. The Indian Express visited locations of four girls’ hostels that were passed off to investors as owned or run by Ashtavinayak Hostels, a purported subsidiary of Ashtavinayak Group. At one of the four addressed (KB Joshi Road), a girl’s hostel by the name ‘Ashtavinayak Hostels’ was found.

Ashtavinayak Girls’ Hostel on KB Joshi Roadwhich, as per the current manager, was taken over by the new management from Selva Nadar in 2021. Nadar, apparently used this property to list two other non-existent hostels – one with the address ‘Vrundavan, Senapati Bapat Road’ (top right) and another with the address ‘Gajanan Housing Society, Model Colony’ (bottom right) by photographing the same building by placing sign boards of these non-existent hostels

The manager at the site, however, said that Nadar’s firm ran the hostel for a brief time from this location but it was shut down during the Covid-19 pandemic after which it was taken over by another management. Nadar continued to show it as an asset to his investor clients. Of the three other addresses listed by Ashtavinayak Hostels, one (Vidya building, F C Road) was found to be non-existent. Pictures attached with two other hostel listings (S B Road and Lakaki Road) were found to be taken at the KB Joshi facility by temporarily installing the sign boards. As per ex-employees, Ashtavinayaka Share Market Training Academy, operated for about a year in 2014-15 from a business location on MG Road, then became ‘dormant”.

Officials with Economic Offences Wing (EOW) of Pune, investigating the case have gathered evidence from Nadar’s office at Nucleus Mall, and believe that there was no real revenue for the firm from its activities in hostels, gold jewellery or coaching. This confirms The Indian Express’ findings. “We haven’t come across any significant revenue to Nadar’s firm from these sources. The money that it received by roping in ‘profile investors’ seems to be the main receipts for the firm apart from the returns, if any, made on the funds invested in stock markets. Increasingly, it looks like a pyramid scheme,” said Assistant Police Inspector Mayur Vairagkar, the investigating officer in the case.

EOW has contacted over two dozen financial institutions which had provided personal loans to the ‘profile investors’ and include many prominent private banks.

“Selva’s profile investor scheme was a scam from the beginning,” said API Vairgakar. “He was knowingly helping his clients obtain loans much beyond their legal eligibility and their repaying abilities and then taking their money by making promises of unreal returns,” he said.

EOW officials said the defrauded clients of Ashtavinayak that have approached the agency have now reached 240. They said that there are 1,300 loan accounts linked to over two dozen financial institutions involved in the case.