The director of a fake firm has been arrested for allegedly duping over 17,500 investors to the tune of Rs 20 crore (Rs 200 million) by promising them that their investments would be tripled in two months, police said on Monday.
Police suspect the accused identified as Digambar Patil might have cheated many more as he had 350 agents spread across the city to lure investors--most of them are middle class people.
According to Economic Offence Wing officials, Patil along with his associates in July 2009 had started a firm 'Avishkar Enterprises' at Lower Parel in central Mumbai, where he floated a scheme stating that the investors' money would be tripled in just 60 days.
The firm has about 350 agents, who have been paid 20 per cent commission on the total amount of deposits, they said.
To gain confidence of the depositors, Patil had returned money till October following which more investors started showing interest in the scheme, they added.
The accused had promoted their scheme through word of mouth publicity, police said adding that after October, all the cheques issued to the victims by the promoters bounced.
A cheating case was registered in N M Joshi Marg police station on December 23 following which EOW has taken up the matter and arrested Patil.
He was booked under relevant sections of the Indian Penal Code and the Prize Chit and Money Circulation Schemes (Banning) Act 1978.
