Several Indian investors duped in Rs 870-crore Ponzi Scheme linked to Falcon Invoice Discounting
Ponzi scheme scam: Thousands of investors in India are desperately trying to recover nearly Rs 870 crore (approximately $100 million) after falling victim to a Ponzi scheme orchestrated by Falcon Invoice Discounting. The scheme lured people into making short-term investments with the promise of high returns, according to a statement from the Telangana police and interviews with multiple victims conducted by Reuters.
The Telangana police arrested two persons on Saturday after filing a case against Falcon Invoice Discounting, which assured investors of returns as high as 22% by falsely claiming to connect them with reputed companies like Amazon and Britannia. Since 2021, the company reportedly collected Rs 1,700 crore (around $196 million) from nearly 7,000 investors but only repaid half of the amount, as per the police statement.
Many victims, including New Delhi-based jeweller Ankit Bihani, have started exploring legal avenues to recover their investments. Bihani, who met with 50 other investors last week, revealed, “Most of them learned about the investment platform through social media and decided to invest.”
Investigations revealed that Falcon operated as a Ponzi scheme, using money from new investors to pay returns to earlier investors, while siphoning off the remaining funds to various shell companies. The police are actively searching for Amardeep Kumar, the founder of Falcon and the main suspect in the case.
The scheme has left several victims uncertain about recovering their investments, including tech professional Roopesh Chauhan, who lost Rs 1.5 crore, and assistant professor S. Smriti, who invested over Rs 30 lakh of her life savings.
The Indian authorities have raised concerns over a surge in fraudulent investment schemes using fake apps, websites, and call centres to deceive unsuspecting investors.
What is a Ponzi Scheme?
A Ponzi scheme is a fraudulent investment operation where returns are paid to earlier investors using the capital from newer investors, rather than from profit earned by the operation. This creates the illusion of a profitable venture, attracting more investors. However, the scheme eventually collapses when new investments slow down, leaving later investors with significant losses.
- With inputs from agencies
