The Enforcement Directorate (ED) has struck a major blow against a sophisticated stock market investment fraud, unearthing a multi-crore scam and seizing significant assets, including gold and silver bullion. The action follows a detailed probe into a network accused of duping investors across several Indian states.
Massive Haul of Precious Metals and Cash
In a series of targeted searches, the Ahmedabad zonal office of the ED seized a substantial cache of assets believed to be the proceeds of crime. The recovered items include:
- 110 kg of silver bullion, valued at approximately Rs 2.4 crore.
- 1.296 kg of gold bullion, worth around Rs 1.7 crore.
- 39.7 kg of silver jewellery.
- Indian currency totalling Rs 38.8 lakh.
- Foreign currencies equivalent to at least Rs 10.6 lakh.
Additionally, the federal agency confiscated crucial property documents linked to the accused. The seizures were made under the stringent provisions of the Prevention of Money Laundering Act (PMLA).
The Web of Deception: Fake Advisory Firms and Nationwide Fraud
The ED initiated its investigation based on a First Information Report (FIR) originally filed at the Kheralu police station in Mehsana district. The complaint alleged that the accused, Himanshu Bhavsar alias Pintu, and his associates, lured victims by promising huge profits from stock market investments. After collecting the funds, they allegedly failed to return the investments and used the money for personal gain.
As the probe deepened, a much larger conspiracy came to light. Investigators discovered that at least six more FIRs had been registered against the same network in different states across India. The total estimated fraud amount skyrocketed to a staggering Rs 10.87 crore.
To execute this widespread scam, the mastermind, Himanshu Bhavsar, reportedly set up multiple offices in Mehsana, Visnagar, and Vadnagar. These offices served as fronts to attract funds from the general public. The accused also hired employees to make cold calls to potential investors, repeating the false promises of extraordinary stock market returns.
SEBI's Role and Regulatory Violations
A key facet of the scam involved the misuse of SEBI registration. The ED release stated that Bhavsar improperly used his individual SEBI certificate for entities named Vishwas Stocks Research, Dalal Stocks Advisory, and Devki Stocks to conduct unregistered advisory activities.
In a related order, the Securities and Exchange Board of India (SEBI) held these three companies and their directors, including Himanshu Bharatkumar Bhavsar, responsible for violations. They were found guilty of contravening regulations by offering illegal investment advisory services, which formed the bedrock of this fraudulent scheme.
This case highlights the persistent threat of organized investment fraud in India and underscores the coordinated efforts between law enforcement agencies like the ED and market regulators like SEBI to protect common investors. The seizure of high-value physical assets like gold and silver bullion marks a significant step in recovering the proceeds of this elaborate crime.
