Madanapalle (Annamayya district): A major financial fraud has come to light in Madanapalle, where thousands of people have allegedly been cheated under a dubious gift-and-return income scheme.

The racket, which is being likened to a ‘chain-link’ scam, has left many residents reeling from losses and demanding justice.

The scheme, promoted under the banner of ‘Spin Gift’ by a private entity named ‘Aara’, reportedly lured more than 6,000 individuals with promises of daily returns and luxury gifts.

According to police sources, victims were encouraged to invest one-time amounts ranging from Rs 2,000 to Rs 20,000.

In return, they were assured of steady income and expensive gifts such as smart phones, laptops, bikes and even cars.

The alleged mastermind, Mohan Babu of Madanapalle, is said to have played a central role in promoting the scheme. Using word-of-mouth campaigns and community connections, he allegedly built trust among locals, some of whom were initially handed out gifts to reinforce the legitimacy of the programme.

However, the distribution soon came to a halt, and returns stopped, triggering alarm and suspicion among the later investors.

As the scheme abruptly collapsed, hundreds of affected residents found themselves without the promised money or prizes. Many victims, now facing financial strain, have approached the police with complaints.

Police have begun a detailed investigation into the case. Preliminary findings indicate that the scam may have extended its reach beyond Madanapalle, affecting individuals across other regions in the Annamayya district as well. Officials are currently verifying the number of investors and the total amount amassed by the organisers.

Meanwhile, the police have urged citizens to remain alert and avoid falling prey to unverified financial schemes that promise unusually high returns. They assured swift action against the culprits and have asked more victims to come forward with evidence or details of their investments.