VIPS Group of Companies Exposed: ED Seizes Assets in 100-Crore Ponzi Forex Scam

In a major development, the Enforcement Directorate (ED) has cracked down on an INR 100-crore scam involving illegal forex trading and Ponzi schemes by seizing immovable assets and digital devices besides freezing bank accounts across multiple cities in India. The EDs zonal office in Mumbai held raids across Ahmednagar, Pune, Kolhapur, and Surat to crack down on illegal forex trading scams run by the VIPS Group of Companies. These companies are run by Vinod Tukaram Khute, close associates, and family members.

ED Unearthes Illegal Documents & Assets in This Forex Trading Scam

The ED found multiple incriminating documents as well as immovable properties worth crores. It also seized digital proof and bank funds associated with illegal operations run by the group. This crackdown is the latest in a round of actions taken by the ED under the Prevention of Money Laundering Act (PMLA), 2002. In May 2024, the ED conducted similar raids across Nashik, Pune, and Kolhapur, which led to the freezing of cash, bank balances, jewelry, and fixed deposits worth approximately INR 5 crore.

How Did Vinod Khute Run This Fraudulent Forex Operation?

Vinod Khute, who is presently absconding and is alleged to be in Dubai, ran fraudulent schemes under VIPS Group, Kana Capital, Global Affiliate Business, Phoenix FX, and Real Gold Capital. As per the authorities, these entities enrolled investors by promising them exorbitant returns via Ponzi structures, unauthorized forex trading platforms, and multi-level marketing (MLM). Vinod and his notorious network operated a racket that involved shell companies, multi-city distribution networks, and fraudulent trading to lure investors, especially the ones new to investing.

The racket collected and layered funds using an elaborate system of shell firms. The proceeds collected were withdrawn in cash and transferred to Dubai using hawala channels or converted into virtual assets or cryptocurrency.

What Led to ED Investigating the Matter?

Several people, who were cheated by the fraudulent schemes, filed FIRs at the Bharti Vidyapeeth Police Station in Pune. he FIR alleged that Mangesh Khute, Vinod Khute, Kiran Pitamber Anarase, Ajinkya Badadhe, and Santosh Khute had cheated people with the lure of high-return investment opportunities. The EDs raids have unearthed a wide network of distributors and intermediaries who have duped investors. This leads the probe into illegal forex dealings, money laundering, and fraudulent investment schemes with international links.

Why is a VIPS Group of Companies Red Flag for Forex Traders?

Firstly, it is not a regulated entity, so its hiding the disclosures necessary for forex brokers to make to the regulator. As a trader, you should always trust a regulated broker so that the money invested goes into hardcore forex trading activities and not for illegal purposes.