Chinese-run Online Investment Scam Busted In Telangana, 3 Indians Among Arrested

A multi-crore investment scam planned by Chinese nationals was busted by the Economic Offences Wing of Cyberabad police on Monday. They allegedly cheated more than 20,000 people for an amount of Rs. 50 crore. Three people who have been associated with them have been apprehended, and the deposits in 10 bank accounts valued at Rs 3 crore and other documents were confiscated. The arrested persons have been identified as Uday Pratap, Nitesh Kumar Kothari and Rajesh Sharma.

According to Cyberabad Police Commissioner VC Sajjanar, several others involved in the scam, including two Chinese nationals, Zhang Hongwei alias Peter and Peng Guowei alias Javie, are absconding. Over a 90-day time frame, the accused individuals offered returns up to 11% per day and four times the investment. They persuaded the victims into investing in Shaked Bike and Sharing Economy schemes through www.ciciseo.com, popularly known as the Shared BK App.

Sajjanar said that, “We will seek help from premier agencies like the RBI Financial Intelligence Unit, Intelligence Bureau and other enforcement wings to dig deep into the case.”  Police said that one of the accused, Uday Pratap was working with a China-based Top1Mobi Technology Company Ltd. in 2016. Javie, the business lead of the company appointed Uday Pratap as the consultant for Telecom Value Added and Advertising Services in the country. Javie and Uday Pratap collaborated together for four years and later got Mobicentric Technologies Pvt. Ltd. Later, Uday was made an authorised signatory for Mobicentric Technologies Pvt. Ltd and others.

Later, Hong Kong-based companies acquired these firms, and Javie was the director of the firm. Peter, the owner of Panda Overseas (Asia) Ltd., which is said to have acquired Flash Wave, was hired by Javie in 2020. The police said the accused had launched a Social Bike app and started to cheat people on Skype and WhatsApp by messaging them. Police noticed that the businesses were fake after verification with the Registrar of Companies (RoC). They were all registered with the Delhi, Kanpur, Pune and Bengaluru RoCs.

The police said that WhatsApp groups around the country were used by the accused to pass the information about Shared BK and Sharing Economy. Most of the people believed and they shared their personal information and bank account data, and became members of the scheme. The owners of the firm invited investments in three schemes and the payment was made through Razorpay, the payment portal.

The returns were showed in the options for withdrawal or pending payment, and credited to the bank accounts of depositors. However, in January 2020, the app stopped operating was non-functional. It was found that the money paid by depositors was credited to the bank accounts of fraudulent Indian companies registered through Chinese websites with Razorpay.

Since all these companies made transactions through the payment gateway of Razorpay, Cyberabad CP VC Sajjanar said they had summoned the company's officials for more information on their mode of functioning. They will also be questioned about the sum of remittances to and from China via Razorpay.

With the crackdown on Chinese apps and websites by the Central Government, Chinese nationals are coming up with new ways to trap citizens. Their frauds are typically conducted for a short period of time, and the fraudsters move very quickly to other forms of cheating.

The fraudsters used to targer cryptotraders, and then moved on to online gaming and betting. After that, they start cheating individuals through personally shared web links. The most recent Chinese fraud category was that of instant loan apps. But now, the Chinese seem to have resorted to investment scams to fool many in the country. Cyberabad CP VC Sajjanar said that, "Not only are they duping people of money, but they are tricking locals into working for them."