Bhubaneswar: The Enforcement Directorate’s Bhubaneswar Zonal Office on Wednesday carried out searches in connection with a multi-state chit fund scam in which investors from Odisha were allegedly duped of crores of rupees.
The ED teams searched seven locations in Visakhapatnam and Hyderabad linked to former Andhra Pradesh MLA Malla Vijaya Prasad, officials said. The action is part of a money laundering probe into the alleged fraud.
Officials said Welfare Building and Estates Pvt Ltd, where Prasad was the managing director, allegedly collected deposits from investors in Odisha and other states between 2009 and 2014. The company promised high returns under various investment schemes before defaulting. The total amount involved in the alleged fraud is around Rs 3,000 crore.
The CBI had earlier registered a case against the company. Several FIRs were also lodged by Odisha Police after complaints from investors in the state. Prasad was arrested by the Economic Offences Wing, or EOW, of Odisha Police from Visakhapatnam in 2021 in connection with the case and was later released on bail.
The ED is now investigating the alleged laundering of proceeds of crime generated through the chit fund operations, officials said.
The searches at the seven premises in Visakhapatnam and Hyderabad were conducted to gather evidence on the trail of funds and assets linked to the case being handled by the Bhubaneswar zonal office.
