Two private investment firms under scanner for likely ponzi schemes
Belagavi district authorities are investigating two private investment firms, Growdhan LLP and City Index, over allegations of running Ponzi schemes. Officials found that thousands of investors had deposited significant sums of money under the guise of loans and debentures.
Why it matters
Highlights the ongoing challenge of regulating shadow financial entities that target retail investors with promises of high returns.
Officers of the Belagavi district administration have launched investigation against two private investment firms following allegations that they collected crores of rupees from the public by promising unusually high monthly returns.
Acting on the directions of District Magistrate Mohammad Roshan, who is also the Deputy Commissioner, a team comprising officials from the Revenue Department, Cooperation Department and the Police, led by Sub-Divisional Officer Shravan Kumar Naik, carried out simultaneous investigation at the offices of Growdhan LLP in Tilakwadi and City Index on Mahatma Phule Road.
Officials examined financial records and other relevant documents during the exercise.
Investigators scrutinised financial transactions, investor records and related documents, with the verification process continuing till midnight.
According to Sub-Divisional Officer Shravan Kumar Naik, initial findings suggest that 1,100 investors have deposited approximately ₹38 crore with Growdhan LLP.
Officials believe that these funds were accepted in the form of loans.
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