First conviction in digital ponzi scam in Odisha; Bihar man gets 7-yr RI

Bhubaneswar: In a first, a local court in Odisha delivered a judgment in a digital ponzi case convicting the key accused and awarding him 7 years in jail with a hefty fine amount.

The OPID Court, Balasore, pronounced the verdict today in an EOW case registered against Prince Kumar and his Company M/s Digital Revolution Technologies Ltd.

The court found the accused guilty under sections 406/ 420/467/468/471/120-B IPC, Sec. 66 of IT Act, Sec. 4/5/6 of Prize Chits & Money Circulation Scheme (Banning) Act & Sec 6 of Odisha Protection of Interests of Depositors Act and sentenced him to undergo Rigorous Imprisonment (RI) for 7 (Seven) years and fine of Rs 3,33,000. In default of fine, the convict will undergo further imprisonment of one year.

The Economic Offences Wing (EOW) registered an online ponzi case on March 14, 2022, against Prince Kumar and his company on charges of duping hundreds of investors of around Rs 1.5 crore in Odisha alluring them of high returns under its different schemes involving digital/online products.

According to complaints, the company had also used/issued forged documents to cheat investors in many states especially in Maharashtra, Bihar, Uttar Pradesh, Delhi, West Bengal, Odisha and Chhattisgarh. Prince Kumar through the company collected huge money from investors assuring them very high returns and misleading them that this company is running successful Desi/ Indian version of Whatsapp, YouTube, Amazon, email, online/digital gaming, digital payment, Netflix etc. kind of products.

Based on allegations, the EOW arrested the main accused Prince Kumar, a resident of Muzaffarpur, Bihar and Director of M/s Digital Revolution Technologies Limited on 18.05.2022 from Brindaban in Uttar Pradesh.

During the investigation, the agency found that Prince Kumar had conducted meetings at Balasore and Bhadrak in March 2020 and distributed brochures and made wide propaganda to convince the gullible investors that his company wish to strengthen India through digital platforms and information Technologies (IT).

Prince Kumar gave false assurances to the investors that investment amount would be double within one year and could able to induce the investors to invest in the company although the company has no commensurate/ real business activity to pay high returns. However people were more vulnerable during COVID time as many of them had income related issues. Beside this Prince Kumar also used glamorous propaganda using website, YouTube, Facebook etc.

During the probe, it was found that the deposits collected by the company under the cover of Direct Digital Marketing are nothing but Ponzi scheme. The business model of M/s Digital Revolution Technologies Limited is a simple pyramid structure in which the early entrants earn money and as the number of investors/depositors increases, finding more investors (New Comers) to join becomes difficult or impossible and the scheme collapses at a point of time. Investors, those who joined late do not earn enough to cover their first outlay.