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Hyderabad: Cyberabad Police has successfully dismantled a massive organized financial fraud operation that exploited advanced AI-powered investment platforms and Ponzi scheme tactics. The perpetrators defrauded more than 3,000 individuals across multiple states, collecting approximately Rs 850 crore by promising steady monthly returns through deceptive stock market prediction software.
Police arrested two key figures behind the network Gaddam Venugopal and Shreyas Paul, a native of Ballari, Karnataka. The operation employed over 20 consultants and agents across major cities, along with technical developers and website administrators to execute the elaborate fraud.
The fraudsters operated IIT Capital Technologies with a fake registered address in Madhapur, Hyderabad, and other companies including AV Solutions based at Sri Nidhi Nest, Kondapur, Hyderabad, Srinivas Analytics Pvt. Ltd., and Trade Bulls Technology Pvt. Ltd. as new front companies.
They used proxy domain registrations with privacy shields to conceal ownership and hosted their operations on Amazon Web Services (AWS) to obscure operator identities. The duo also displayed fake SEBI, NSE, and BSE registration numbers for credibility.
To establish legitimacy, they organized investment seminars across Andhra Pradesh and Telangana and maintained premium offices to project authenticity. Police said they focused on middle-class families, retired individuals, and working professionals, operating through referral-based recruitment systems while using psychological profiling to exploit victims' vulnerabilities.
The fraudsters promised 7 per cent monthly returns (84 per cent annually) through fake AI-based predictions and created fabricated dashboards displaying fictitious profits. They adopted a Ponzi structure whereby 20–30 per cent was allocated for limited trading, 40–50 per cent was used to pay earlier investors, and the remaining balance was siphoned for personal gain.
The operation managed 21 mule bank accounts across ICICI, HDFC, Axis, Kotak Mahindra, and IndusInd banks, deploying layering techniques to camouflage fund flows. The duo converted illicit deposits into real estate, gold, and luxury vehicles and operated international laundering channels, including Dubai-based operations.
To conceal their illicit activities, they systematically deleted digital records, threatened victims who attempted to file complaints, and shut down websites when under regulatory scrutiny.
Investigations revealed that 3,164 victims across multiple states fell prey to the fraud. The perpetrators collected a total amount of Rs 850.59 crore, of which Rs 232.36 crore was fraudulently retained by them between 2022 and 2025. Police seized 11 laptops, mobile phones, backend trading access credentials, and a database containing 3,164 customer records.
"The fraud operation caused devastating consequences for victims. Hundreds of families suffered severe psychological trauma as their retirement savings and children's education funds were completely wiped out. Many families were forced into debt and bankruptcy, highlighting the far-reaching human cost of this sophisticated financial crime," said a senior police officer in the Cyberabad Police Commissionerate.