Behind Rs 140 Crore Fraud, Misuse Of PM Mudra Yojana Branding, 2 Arrested

The chairman of a cooperative society and his son have been arrested by the Telangana Crime Investigation Department (CID) over a Rs140 crore financial fraud carried out under the pretext of the Centre's flagship Pradhan Mantri Mudra Yojana (PMMY).

Tippaneni Ramadasappa Naidu, 61, chairman of Mudra Agriculture Skill Development Multi-State Cooperative Society Limited, and his son, Sai Kiran, 43, a key member of the society, were remanded to judicial custody today. The father-son duo allegedly cheated 2,000 people through the scam.

Mr Naidu established the fraudulent cooperative society in 2017, deliberately misusing the PMMY's branding to deceive the public into believing that it was a government-backed entity, revealed the CID probe. Through extensive advertisements in regional newspapers, thousands of individuals, including farmers, unemployed youth, and daily wage workers, were enticed with false promises of lucrative returns on investments and guaranteed government jobs.

The victims were reportedly assured that the Society would transition into a full-fledged bank within two years and secure permanent government employment for all its members.

The scam involved publishing job advertisements for 2,000 government marketing supervisor positions, collecting original educational certificates, and extracting substantial amounts of money under the guise of share capital and investment bonds.

The Cooperative Society expanded its network, establishing approximately 330 branches across Telangana and Andhra Pradesh.

The Society employed around 1,600 individuals who were tasked with collecting deposits. Employees who failed to meet their aggressive collection targets faced salary deductions. Employees who resigned were reportedly denied the return of their investments, threatened, and coerced into signing blank papers.

According to CID officials, the fraudulent scheme enabled Mr Naidu and his son to collect an estimated Rs 140 crore. A significant portion of these funds was reportedly used to acquire industrial plots in Anantapur district of Andhra Pradesh and also properties in the Keesara area of Telangana.

The massive fraud came to light after numerous complaints were lodged at various police stations across Telangana. The CID took over the investigation, meticulously tracing the money trail and gathering evidence, which ultimately led to the arrests of the father-son duo.