Thiruvananthapuram: Kerala's Competent Authority that enforces the Banning of Unregulated Deposit Schemes (BUDS) Act has referred the investigation into the alleged Rs 3,141-crore Highrich money chain scam to the Central Bureau of Investigation.
Competent Authority Sanjay M Kaul transferred the case to the premier central agency based on the recommendation of the State Police Chief.
Read Also: Cooperative bank scam: More banks in Kerala come under ED scanner
According to the order dated March 16, all the Highrich cases registered in Cherpu Police Station, Thrissur, as well as other connected cases registered elsewhere or to be registered, have been referred to the CBI. The Competent Authority's recommendation is deemed to be with the consent of the state government, under the BUDS Act.
Cherpu Police Station had booked K D Prathapan and Sreena Prathapan, promoter couple of Highrich Online Shoppe Pvt Ltd, under various sections of Prize Chits & Money
Circulation Schemes (Banning) Act, 1978, and under various sections of the BUDS Act, 2019.
In a letter dated January 1, the State Police Chief wrote to the Competent Authority of the BUDS Act that Highrich Online Shoppe ran a money circulation scheme and illegally raised Rs 750 crore from people. It said the firm collected an initial amount of Rs 700 from depositors by promising high returns, provided they brought in new members. "The firm is operating across India and has more than 1.5 crore members," said the State Police Chief's letter on January 1.
Nearly a month later, on January 29, Chief Minister Pinarayi Vijayan said in a written reply to Ernakulam MLA T J Vinod that Kerala Police found Highrich received Rs 3,141.34 crore as investments from people in Kerala and other states.
As the depositors, deposit takers, and properties involved in this case are located in more than one state and the total amount involved is large, the State Police Chief specifically recommended referring the case to the CBI under Section 30 of the BUDS Act.
The Directorate of Enforcement (ED) is also investigating the Highrich couple for possible money laundering.
In January, ED searched the couple's offices at Cherpu and reportedly found that the Thrissur-based firm had illegally raised Rs 1,157 crore from the public as membership fees for its pyramid scheme run under the guise of an online grocery business.
ED also found that the company and its promoters have parked Rs 212.46 crore in 55 accounts at four private banks. ED issued an order to freeze all these accounts.
