Belagavi Officials Raid Growdhan and City Index in Rs 68 Crore Ponzi Probe

The Belagavi district administration has conducted raids on two companies operating in the localities of Tilakwadi and Shahapur for allegedly running unauthorized Ponzi investment and deposit schemes. The crackdown, which was carried out under the provisions of the Karnataka Protection of Interests of Depositors (KPID) Act and the Ban on Unregulated Deposit Schemes (BUDA) Act, revealed that the firms had collected investments totaling Rs 68 crore from more than 2,600 investors.

The search operations took place at Growdhan, located in Guruwar Peth, Tilakwadi, and City Index, situated on Mahatma Phule Road, Shahapur. Speaking to reporters on Saturday, Shravan Nayak, the Assistant Commissioner for the Belagavi Subdivision, detailed the scale of the unauthorized operations.

According to Nayak, Growdhan had collected approximately Rs 38 crore from 1,100 investors. These transactions were reportedly framed as hand loans. Preliminary inquiries by the administration suggest that Growdhan lured depositors by promising monthly returns of 4 percent. Nayak stated that a comprehensive report regarding Growdhan’s activities would be compiled and submitted to the deputy commissioner for further action.

Meanwhile, the second targeted company, City Index, allegedly collected around Rs 30 crore from 1,500 investors. This capital was raised through the issuance of debentures. While representatives of City Index claimed that the company had the necessary permissions from the Securities and Exchange Board of India (SEBI), authorities are currently verifying these assertions. Nayak confirmed that the administration is reviewing all documents related to City Index and will also submit a report on its findings.

To determine the exact flow of funds, the administration plans to conduct a detailed examination of the bank statements of both entities. This process will help officials gather precise investor information and verify the actual returns that were paid out to depositors. The returns offered by City Index are also under active investigation.

In light of the findings, Nayak issued a public warning advising citizens against falling prey to fraudulent schemes that promise unusually high returns. He urged the public to limit their investments to nationalized banks and other financial institutions registered with the Reserve Bank of India and other competent regulatory authorities.