The local police here arrested three people on Wednesday for allegedly cheating the public through an illegal multi-level marketing racket running to Rs 100 crore.
The police said, Jinna Srikanth, the prime accused along with two others, started multi-level marketing business M/s Green Gold Biotech in December 2014 without getting requisite permission from the state authorities. They introduced schemes to 1,550 customers with an intention to cheat them.
A case under relevant sections of the IPC, the Prize Chits And Money Circulation Schemes Act and Telangana Protection of Depositors of Financial Establishment Act has been registered against the accused
For promoting the multilevel marketing the accused introduced different levels of Agents/stockiest and induced them with 12 months proportionate incentive on direct/indirect team businesses for a period of 12 months, commission on the monthly basis and bonanzas like mobile phones, laptops, bikes etc at the year ending. Initially, the company paid the members the promised amount but later refused to do so.
During the preliminary investigation, police have identified 1,385 customers in Rs. 1 lakh scheme, 144 customers in Rs. 2 lakh scheme, 19 customers under Rs. 5 lakh and four customers in Rs. 10 lakh scheme.
With the extorted money, the accused purchased a 3BHK flat at Peerzadiguda worth Rs. 1 crore and a HEXA car. He also gave away a huge amount of money to his close aides and managed to stock raw material in the Uppal godown
The accused later expanded their business to Andhra Pradesh, Telangana, Karnataka and Maharashtra, after building a large customer base, the police said.
Further investigation into the matter is underway.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)