Investment scheme scam: ED officials arrest two from Erode

Chennai: The Directorate of Enforcement, Chennai, has arrested two key operatives in connection with the massive Rs 1,417.86 crore money laundering that defrauded nearly 36,000 investors under the guise of export investments, the agency said. The arrested individuals, S Naveen Kumar and S Muthuselvam, were taken into custody on September 29 under Section19 of the Prevention of Money Laundering Act (PMLA), 2002, the ED’s Chennai Zonal Office-II, said. They were subsequently produced before the Special Court for PMLA cases, which remanded them in judicial custody for 15 days.

The ED’s money laundering probe stems from a First Information Report (FIR) originally registered by the District Crime Branch, Erode, in the state, under money laundering and the Tamil Nadu Protection of Interests of Depositors (TNPID) Act. According to agency officials, the duo, along with their associates, floated fraudulent investment schemes titled “UNI,” “FNP,” “FAP,” and “UNR” under the business names of M/s Unique Exports, East Valley Agro Firms, and other connected entities. Investors were lured with promises of lucrative returns allegedly generated from agricultural export profits.

However, financial analysis revealed that the firms undertook virtually no substantial export business and were operating purely as a financial trap, a release said on Thursday. Around Rs 1,417.86 crore was mobilised from approximately 35,759 gullible investors across the region. Investigations uncovered that over Rs 719 crore was deposited into various accounts linked to Unique Exports, with investor funds systematically routed and layered through more than 100 bank accounts held by associated firms, family members, and close aides.

Naveen Kumar, the proprietor of Unique Exports and alleged mastermind of the scam, personally controlled the banking operations and fund movements. Investigators found that Rs 390.90 crore was falsely logged as salary payments, despite the firm employing only four staff members.

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