Noida: Hard to believe but a 26-year-old BTech graduate has tricked more than 6 lakh people into giving him their money through a Ponzi scheme that promised big returns for hitting 'likes' online. In about a year, Anubhav Mittal's Social Trade committed fraud of a whopping Rs 3,700 crore.
The scheme operated through a maze of dubious URLs (online links) sent to phones of subscribers that they were asked to click. These would sometimes be links to Facebook or Twitter profiles of other subscribers. A fake server was set up where these links would terminate.
The scam came to light with the arrest of Mittal and his two aides — 40-year-old Shridhar Prasad, an MBA, and 25-year-old Mahesh Dayal, who served as tech support — from an office in Noida's Sector 63 on Thursday.
They had created a fake company called Ablaze Info Solutions Private Limited that operated from there.
The STF team that raided the office found 250 passports, purportedly of some high performers and employees of the fraudsters, who were to be rewarded with a trip to Australia.
The investigation also led police to Rs 520 crore deposited in 12 accounts of the company registered in Canara Bank, Kotak Mahindra Bank, Yes Bank and Axis Bank. The officials are investigating the company's balance sheet, investors' information, and bank accounts to which money was transferred.
Mittal's Social Trade used to tell investors that the company got business from a third party to increase the latter's online hits on digital platforms. The investors were given 25, 50, 75 and 125 URLs on their phones every day, based on the 'subscription plan'.
Amit Pathak, senior superintendent of police, STF, said the trio had launched Social Trade as a pyramid scheme in 2015, telling people they could earn sitting from home. "They enrolled people with subscription money ranging from Rs 5,750, Rs 11,500, Rs 28,750 and Rs 57,500. The investors were given a user ID and password and told they would get random URLs on their phone and would be paid Rs 5 per like," Pathak said.
For this purpose, they used Ablaze, which rented a four-storey building in Sector 63 for its office. Investors were told that they would receive monthly payments in their registered bank accounts. They were also told if they brought in more subscribers within 21 days, their income would increase. This process was called a 'booster' and, like any other Ponzi scheme, helped build a pyramid of investors.
"We found there was no business from any third party for getting online hits. The probe shows the accused had set up a fake server in Ghaziabad and the URL links terminated on the same server," Pathak said.
The trio also shifted the domain name of their website frequently to hoodwink police. The Social Trade website — socialtrade.biz — was transferred to freehub.com in December 2016. Ten days later, it was shifted to intmart.com. On January 27, the business was shifted to frenzzup.com. Last week the accused had also changed the company's name and put up a board of W-3 Company.
Ablaze paid monthly rent of Rs 7 lakh for the office. Mitta took home a 'salary' of Rs 5 lakh a month while Shridhar received Rs 1 lakh. Police said subscription money was their only revenue and the scheme was doomed to fail.