How Rs 3,700 crore online fraud happened with with 7 lacs investors !

POSTED BY Jagoinvestor ON February 3, 2017 COMMENTS (59)

A new online fraud worth Rs 3,700 crores has been busted recently by Uttar Pradesh special task force. Around 7 lacs people have been cheated in the name of ‘Earn Rs 5 per click’ investment scheme.

This was a classic example of a very smart online fraud structure where you first make a lump sum investment in the company scheme, and you get a chance to earn a daily income by liking facebook pages. You can also add people under you (more money comes in the company) and you get benefits from that.

Structure wise it’s very similar to speakasia where you earned money by taking the survey’s and here you get it by click on the pages.

A company was set up with the name of “Ablaze Info” whose board of directors named Anubhav Mittal, Shreedhar Prasad, and Mahesh Dayal are arrested. They had set up various websites to dupe people like,,,

How this scheme worked?

There were 4 schemes where you had to pay a joining fee ranging from Rs 5750 to Rs 57,500 and you got X number of clicks each day which assured you get Rs 5 for each click, making sure you get a monthly income.

social trade online fraud

There was also a bonus for adding more people under you (2 people) and some more benefits apart from that. It was a classic case, where few people join the scheme, get the assured income for 1-2 months and by then they bring more people by word of mouth, who bring more money in a company which makes sure that the fraud company has more money to pay everyone …

This continues for a few months/years and once there are thousands of people at the bottom who brought millions in the company, that’s the time when the company either runs away with all the money or they are caught by the law as it happened in this case.

Members trying to add other members

Every MLM scheme works on the basis of referrals and most of the people were trying to add others under them to get the bonus and added benefits which come out of referrals.

People started approaching their friends and other relatives to join this “business” and you can see in the video below how one of the people who was part of this is explaining the business model and is so convinced about it himself.

Why most people get duped in these kinds of fraud schemes?

You will find a lot of people who still believe in this kind of schemes mostly because they are not duped themselves and have experienced earning income consistently from these companies, but that is true for a small minority of people who join this fraud business early, because that’s the time when the company properly pays money without fail

The problem happens when the user base is quite big (in this case, 7 lacs) and then it becomes almost impossible to sustain the madness. Here is how the MLM business looks like

In the video below you can see how this one guy is so convinced about the authenticity of this social trade business and feels that the crackdown on the company because govt can’t sees poor people earning lots of money.

Do you know anyone who was cheated by Social trade company? What do you think about these kinds of MLM schemes?

59 replies on this article “How Rs 3,700 crore online fraud happened with with 7 lacs investors !”

  1. Ram Kumar Rama Krishnan says:

    I pity the greediness.

    I ‘ve very close friends and acquaintances who comment my investments in Equities as risky, but fall for these traps!

    And they call themselves as risk averse and hence stay away from the market!

    1. Thanks for your comment Ram Kumar Rama Krishnan

  2. Still people have hope.. Company will return as there were legal documents.. Jantar Mantar and all time wasting stuff..

    1. Thanks for your comment Anubhav Mittal

  3. ePandit says:

    Just one month ago, an unemployed young neighbour tried to convice me to join this scheme. He had paid ₹ 57,500 as joining fee and till now had only earned 4000-5000. I was felling pity on him for his wrong decision. And finally the poor guy lost his money.

  4. Pradeep says:

    The police and local politicians would have got their cut for this business to flourish until it became to big a scam to continue. Make no mistake, the authorities are too corrupt to stop such scams at the root and these things will keep happening again and again.

    1. Thanks for your comment Pradeep

  5. Venu says:

    Yes, I know my best friend is invested in it. Actually I asked him not to invest and I told him it is a fraud scheme, but he needs extra income every month and in the end he convinced me to join and I know this is a fraud scheme and still I am ready to invest for the sake of my friend but on one condition, that after I join he need to get two more people under me.

    I know that he can’t do that because he was already invested 1L in it. You can say my luck that I was not invested and soon the news of this online fraud all over the media. But sad thing is my friend lost all his investment.

    Be very careful!

    1. Hey Venu

      Thanks for sharing your experience with all of us. It was a great learning.


  6. Mayur says:

    I know few people who were into it and my wife was asking from a long time to enroll in this. I was just waiting for it to bust 🙂

  7. Joel says:

    Hi Manish,

    I know of a lady (HW) who was trying to push this scheme to all our neighbhours especially those who are at home. I knew from start this was fishy and the bubble was going to burst it was only a matter of when. Anyways I feel sorry to all those who fell prey and lost money.

    1. Thanks for sharing that Joel

  8. Reshmi says:

    Nice writing !

  9. Deep says:

    Vaishali, Ghaziabad

  10. Deep says:

    there is one more guy running same scheme from an office in Vaishali. I dont know the details but one of my relative spoke about this scheme in Dec 2016

    1. Thanks for sharing that Deep

  11. Chandu says:

    These days people are finding ways to earn easy money. Well educated also getting into the business fascinated by lumpsum gains in short period without spending much effort. They should understand somewhere under them people will get cheated and then they realize the fault they made. Not sure if still people regrets at the end :). few of my friends approached me and right away disconnected the idea and said not interested. I know the pain of many of my friends who fall prey for it, sometimes same person got into couple of times 🙂

    1. Yes, a lot of times people dont even that the knowledge and understanding that this can be fraud !

  12. KB says:

    Assuming the blue individual recruits five, and those five recruit their own five, and so on, the maximum theoretical cycles of recruits possible is 14 cycles (5^14 = 6.1 billion people), after which point the total human population is exceeded.
    Hence these schemes are always doomed to fail and will eventually see the ‘founders’ abscond

  13. sandeep says:

    you cannot help people who want to be cheated? i dont understand how people can be so gullible.

  14. pankaj says:

    Sir, What is your advise or next course of action who has already trapped/invested money in this scheme. How can they recover their money back ?

    1. I dont think there is any way.. It not a legitimate business as such and if police gets hold of all the money, then you might have to show proofs and claim the money you paid. I think its a painful and long process ..

  15. Anand says:

    My friend from hyderabad joined this scheme.
    In the month of January 2017. He got the click or website links for 2 weeks but did not got single ruppee.
    Sadly one of his close friend asked him or even I can say motivated him to join the scheme.

    1. Yea, I heard some people tell me similar stories. After a while you find out that its a fraud !

  16. Shivakumar says:

    It is really an eye opener to all who want to become rich overnight or look for some easy way to become rich. Gullible people easily fall prey to this.
    I have come across a similar pyramid MLM scheme called QNET , some one proposed to me & I rejected.

    1. Thanks for your comment Shivakumar

  17. N K DHENISH says:

    I myself was earning from this company. Only in Jan’17 there was some problem with payment as they were shifting their business model from service based to product based. As far as I know they didn’t cheat people with 3700 crore rupess. Of course they must have collected that much amount from many people and have been very regularly paying the promised amount from the collected money. They were supposed to start the product based website and the daily work website (first it was and then they renamed it to within a few days that too before the actual work started ) from Feb’17 onwars and they were supposed to make all pending payments in the coming weeks when the UP STF crackdown happened. I still don’t believe they were duping people, if it was so they could have run away with 3700 crores as happened in many other cheating cases. Of course there was some delay in making payments in Jan’17 during the transition from service based business to product based business. Till then all those joined have been earning money regularly. I think they will be able to prove all these things in the court with documentary evidence.

    1. Lets see how it goes with investigation. I think if they are good people, they will come out clean very soon !

  18. Rohith says:

    I know 7-8 of my colleagues who were doing this. They had actually spoken to me regarding this few months ago and were trying to convenience me to join this. I had rejected their invitation saying it looks like a fraud to me and guess what just under few months it turns out to be fraud! Now all of them claim that they have got back the money they invested but I don’t trust that statement.

    1. I think some of them might have got the money because they were early joinees, but the sad thing is that 10 people whom they added might not have got 🙂 ..

  19. Aarti Girme says:

    Bitcoin ..How safe it is to invest

    1. Its still early to comment on that .. We are still to study that .. will write an article on this topic very soon !

  20. prasad yelgodkar says:

    Such frauds are creating wrong picture about network marketing industry

    1. Yes, I agree to that

  21. Ramki says:

    I am also asked to join this and make lots of money, Manish. When I analysed the model, I felt exactly the same way as you explained in your diagram who make money and who lose money. I told my friends who approached me that this has to fail at 5th level or 6th level. Also, no one can guarantee Rs.5 per click as the ‘click’ revenues are not fixed. So this model is destined to fail.

    1. Yea thats correct. Its good that you controlled yourself and did not invest 🙂

  22. Lakshmi says:

    These kind of things will keep coming as long as people have that greed to make easy money in short time. Same is the case with chit fund companies as well.even very ppl believe these guys only for higher interest and end up loosing all their savings.

    1. Thanks for your comment Lakshmi

  23. Varun says:

    Manish – There is difference between legitimate MLM or direct selling like Amway/Tupperware and ponzi schemes like this company. worry part is people are not educated and till the time they get easy money they think its a good business. there is no product or service here and its simply fraud.

    1. Yes, agree to that, There are many business which run on MLM model , and they are not fraud !

  24. Would "JAGO INVESTOR" be interested in publishing "Heliios & Matheson Information Technology Ltd" not paying fd holders since more than two years says:

    Keep up the good work

  25. Deepak Patel says:

    Hi Manish,

    Thanks for sharing it. Still there are a lot of companies who are doing the same thing. I know lot of peoples who’ve invested lot of of their hard earn money in such scams. some other companies are listed below:

    1. webwork
    2. webpagelike
    3. afofee
    4. Adcash

    and other more than 10 which were came into my notice ore told by some friend but currently unable to memorise. Peoples are joining them for a quick profit and earning. When action will be taken on them it is a big question. Why these special forces come into existence and take action after a big crowd is involved and get cheated.

    1. Thanks for sharing those new names .. I am sure many people will save their money ..

  26. Amit Gupta says:

    Yes, one of my friend asked me to join this business. But I learnt my lesson long back after burning my hands in ebiz during college days and loosing my father’s hard earned.
    Conclusion is there are no shortcuts to earn quick money. One has to work hard and invest for future goals.

    1. Yup .. I think its good that you burned your hands in the start and now saving your money 🙂

  27. Anjan says:

    Classic ponzi scheme. Stupid people falling for it since time immemorial. This is how smart people make money on the back of the dumb ones. What else is new?

    1. yea .. thats correct !

      Thats one reason why I truly dont feel very bad about these people who lose the money 🙂

  28. Patil says:

    Such type of bogus companies are unearthed every now and then. Even every media house reports about such bogus companies. It’s again people’s ignorance which promotes such business.

    People should check authenticity of such companies. High time to think beyond quick money.

    1. Hi Patil

      Thanks for your sharing your valuable comment on this topic. Please keep sharing your views in future also


  29. FIndependent says:

    It is indeed surprising, that there are still people who believe in such pyramid schemes and even “invest” in it. SpeakAsia was a 2200 crore scheme and the founder was arrested few years ago. People have poor memory and even poor awareness of simple Investment schemes and fall for promises of quick money.
    There are many smaller schemes which run under different names and I have seen that they try to rope in younger generation and even students into such schemes

    1. Yea :).. I think these things will never stop .. There are so many people who will never be able to get this point that if anyone is offering you way more than inflation numbers, then there is something fishy about it or heavy risk associated !

  30. Hemanth Chandra says:

    hey, not able to view video. getting an error that video is private….

    1. Seems like the original video owner has put it as private now ! , we cant do anything in this 🙂

  31. Ankur says:

    Just one basic principle in life, no lunch is free! Stick to that and you are safe!

    1. Yup ! … and if there is free lunch, it would surely cost you sometime in future 🙂

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