Rs 1,000 Cr Network Marketing Scam Exposed; Andhra Pradesh's Kurnool At Centre Of Multi-State Fraud

Kurnool: The Criminal Investigation Department (CID) has unearthed a massive network marketing scam, amounting to Rs 1,000 crore, with Andhra Pradesh's Kurnool being at the centre of operations. Investors across the country have been defrauded under the guise of high investment returns, officials said.

The scam was operated by Shreya Infra and Marketing Private Limited, owned by Hemant Kumar Rai. Initially pegged between Rs 270 crore and Rs 300 crore, investigators now estimate the scam has exceeded Rs 1,000 crore. The fraud came to light in 2024 after hundreds of investors approached police, complaining of non-payment.

According to officials, the company attracted investors with lucrative schemes promising unusually high returns. For instance, an investment of Rs 1 lakh assured monthly payouts of Rs 12,000 for 18 months, effectively doubling the principal. Other schemes like the Gold Investment Plan, Vehicle Investment Plan, and Principal and Profit Both lured people with offers of gold, vehicles, and heavy profits within short periods, they added.

Operating across Andhra Pradesh districts such as Srikakulam, Vizianagaram, and Visakhapatnam, and extending to states including Telangana, Uttar Pradesh, Delhi, Haryana, Himachal Pradesh, Bihar, and Assam, the company built a vast network of over 30,000 members nationwide.

The business model relied heavily on referrals, where existing members earned commissions for recruiting new investors. Titles, incentives, and luxury rewards like cars were used to create an illusion of success and legitimacy. In Kurnool alone, over 18,000 members were reportedly enrolled.

To further gain trust, the company purchased 51.55 acres of land in Parumanchala, showcasing it as a tangible asset. However, in 2024, the company abruptly shut down its operations, leaving investors stranded. When victims questioned local representatives, they were allegedly warned against filing complaints with claims that legal action would jeopardise any chances of recovering their money.

Investigations revealed that the victims include government employees, police personnel, teachers, and even former servicemen. Their hesitation to come forward, fearing social stigma, has slowed the complaint process, an official said.

The case was transferred to the CID after authorities confirmed its inter-state nature. Assets, including the land at Parumanchala, have been attached. However, concerns remain over the recovery of remaining assets.

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