States » SouthPosted at: Nov 2 2026 5:57PM


ED attaches Rs 427 crore assets in Rs 2,459-crore Belagavi Ponzi scam

Bengaluru, Nov 2 (UNI) The Enforcement Directorate (ED) has provisionally attached assets worth Rs 427.16 crore belonging to Belagavi businessman Shivanand Siddappa Neelannavar and his associates in connection with an alleged Rs 2,459.49-crore Ponzi investment fraud involving more than 35,000 investors, primarily in Karnataka.
The attachment, ordered by the ED's Mangaluru Sub-Zonal Office on October 30 under the Prevention of Money Laundering Act (PMLA), covers movable and immovable properties allegedly acquired from the proceeds of the investment scheme operated through Shivam Associates and associated entities.
According to the ED investigation, the accused allegedly collected Rs 2,459.49 crore from more than 35,000 investors by promising assured monthly returns of three per cent and an additional 0.5 per cent commission for bringing in new investors. The scheme allegedly operated through a network of referral agents, described as "leaders", who were encouraged to recruit more investors.
The latest attachment comprises fixed deposits worth Rs 367.78 crore across multiple banks, bank balances of Rs 44.38 crore in 47 accounts, immovable properties valued at Rs 13.69 crore and share-market investments worth Rs 1.32 crore.
The immovable assets include agricultural land, family bungalows and bookings for apartments in residential projects.
The ED investigation found that a portion of the money collected from investors was allegedly channelled into high-risk stock-market trading, resulting in reported net losses of Rs 185.95 crore.
The agency also traced the movement of approximately Rs 25 crore through two cooperative institutions — Shreemata Co-operative Credit Society Ltd and Dhanashree Multipurpose Co-operative Society Ltd.
According to the ED, funds were routed through these institutions to create fixed deposits, which were subsequently used as collateral to obtain loans in the names of associates. The borrowed money was allegedly used to purchase land.
Investigators further found that investor funds were transferred to bank accounts of close family members, including Neelannavar's wife and minor son, besides being channelled into businesses associated with him.
Around Rs 19 crore was allegedly routed to Shivam Sevaa (OPC) Pvt Ltd. Other linked entities included Shivam Lifeline Pvt Ltd and Shivam Foods.
As part of the investigation, the ED conducted searches at eight premises in Belagavi, Chikkodi and Nipani in August 2026. The searches reportedly led to the recovery of documents, handwritten audit notes, mobile devices and digital transaction records that helped investigators trace the alleged movement of funds.
The agency had earlier frozen bank accounts and fixed deposits containing approximately Rs 2.02 crore allegedly derived from investor funds.
Neelannavar was arrested in August 2026. On October 9, the ED filed a prosecution complaint against five accused persons and entities before the special court dealing with PMLA cases in Mangaluru.
The case originated from an FIR registered by the Malamaruthi police station in Belagavi under provisions of the Bharatiya Nyaya Sanhita, the Banning of Unregulated Deposit Schemes Act, 2019, and the Karnataka Protection of Interest of Depositors in Financial Establishments Act, 2004.
The ED's investigation is continuing to trace the alleged diversion of investor funds through financial institutions, family members, associates and business entities.
The Rs 427.16-crore attachment represents assets provisionally attached and not money recovered or refunded to investors. The attachment is subject to adjudication under the PMLA.
The case has brought into focus the vulnerability of small investors to high-return investment schemes and the difficulties involved in tracing funds allegedly mobilised through extensive referral networks.
UNI BDN
Tags: #ED attaches Rs 427 crore assets in Rs 2#459-crore Belagavi Ponzi scam
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