Thousands of Indian investors lose $100 million in Ponzi scheme, police say

Thousands of investors in India are scrambling to recoup nearly $100 million after they were caught in a Ponzi scheme that duped them into making short-term investments promising high returns, according to a police statement and multiple victims Reuters spoke to.

Indian police arrested two individuals on Saturday after a case was filed against Falcon Invoice Discounting, which promised returns of up to 22% by claiming to connect depositors with the likes of Amazon and biscuit maker Britannia.

Falcon collected INR 17 billion (about $196 million) from nearly 7,000 investors since 2021 but has repaid only half, according to a statement from police in the southern state of Telangana.

Ankit Bihani, a New Delhi-based jeweler, met with 50 other investors last week to discuss measures, including legal remedies, to recoup the collective INR 500 million they said they had lost.

"Most of them (investors) got to know about the investing platform through social media and invested in it," Bihani told Reuters.

Falcon used the money from new investors to pay out older ones and diverted the remaining funds to various shell entities, the police said. Authorities are hunting for Amardeep Kumar, Falcon's founder and the main accused, a source said.

However, some of the victims that Reuters spoke to are left wondering if they will recoup the money — entire life savings, in some cases — they entrusted to Falcon.

"It is my hard-earned money. We don't know when and how will we get it back," said Roopesh Chauhan, a tech employee who lost INR 15 million.

S. Smriti, an assistant professor, reached out to the police after losing over INR 3 million.

"The money was all our savings," said Smriti.

Indian authorities have expressed concerns over a recent surge in complaints from people being duped by phoney investment schemes that rely on fraudulent apps, websites and call centers to deceive unsuspecting investors.

Britannia, Amazon and Falcon did not respond to requests for comment from Reuters sent on Monday. ($1 = 86.8550 INR)