Scam involved collection of deposits totalling Rs 16 crore through a Vizag-based firm

The Visakhapatnam police on Tuesday busted a scam involving collection of deposits totalling Rs. 16 crore with the promise of high returns through the ‘export’ of oil extracted from fish.

The scandal involved collection of deposits, mostly from people belonging to Karimnagar and nearby areas, through a city-based firm. The city police arrested the kingpin behind the racket, N. Vamsi Krishna Reddy, and one of his associates, Pidakala Benarji. On receipt of complaints by the Karimnagar police, the Two Town police here conducted inquiries into fictitious firms, including Visakha Fisheries Pvt. Ltd, which had its office at Daba Gardens and caught Vamsi and Benarji.

Police said the main accused, an MSc and B.Ed graduate who founded Sri Sai Vidya Niketan in Karimnagar in 2001 and later forayed into the rice business, and Benarji, who worked as a teacher with him for sometime, hatched a conspiracy to dupe gullible investors after they went bankrupt.

Evasion of interest

Of the Rs.16 crore collected, they returned the principal amount of Rs.5 crore to some depositors and later evaded payment of interest to them on some plea or the other since three months. ACP (East) M.N. Mahesh and CI Mallikarjuna Rao told reporters that they suspect the involvement of some more people in the scam.

While the main accused belongs to Kothirampuram in Karimnagar, Benarji hails from Kovvur.