Archive · 11 Oct 2026
ED Files Complaint in Alleged ₹2,459 Crore Ponzi Scheme
The Enforcement Directorate says a large investment scheme may have taken money from more than 35,000 people.
It alleges the scheme promised investors a 3% monthly return and extra money for bringing in new investors.
The agency says much of the money from new investors was used to pay people who had joined earlier.
It alleges that other money went into investments, property, businesses, and film production.
The ED says investors are still owed ₹2,125.60 crore in principal.
It has filed a complaint against five individuals and entities in a court in Mangaluru.
The agency also says it searched eight locations and froze ₹2.02 crore in accounts and deposits.
These are allegations in the ED’s case, not a court finding of guilt.
The Enforcement Directorate filed a prosecution complaint on October 9 against five individuals and entities in Mangaluru over an alleged ₹2,459.49 crore Ponzi scheme.
The ED alleges Shivanand Siddappa Neelannavar and associates promised investors monthly returns of 3% and referral commissions of 0.5%, drawing more than 35,000 investors.
According to the agency, new deposits were largely used to repay earlier investors, while other funds were diverted; investors allegedly remain unpaid for ₹2,125.60 crore in principal.
The ED says funds were channelled into stock trading, real estate, film production, cooperative institutions, and accounts belonging to Neelannavar’s wife and minor son.
After searches at eight locations in August 2026, the ED reported seizing records and freezing bank balances and fixed deposits worth ₹2.02 crore.
- Who
- The Enforcement Directorate has filed a complaint against five individuals and entities, including alleged scheme organiser Shivanand Siddappa Neelannavar and Shivam Associates.
- What
- A prosecution complaint alleges a ₹2,459.49 crore Ponzi scheme that attracted more than 35,000 investors.
- When
- The complaint was filed on October 9; the searches took place in August 2026. Neelannavar was arrested on August 13, with the year not specified in the article.
- Where
- The complaint was filed before the III Additional District and Sessions Court in Mangaluru; searches were conducted in Belagavi, Chikkodi, and Nipani.
- Why
- The ED alleges investor funds were used to repay earlier investors and were also diverted to personal use and business ventures.
Enforcement Directorate’s allegations
Accused’s position
Use of investor funds
Enforcement Directorate’s allegations
The ED alleges new deposits were largely used to repay earlier investors, while other funds were diverted to personal use and various ventures.
Accused’s position
The article does not report a response or defence from the accused.
Responsibility for the scheme
Enforcement Directorate’s allegations
The ED’s complaint names Neelannavar, his firm, and other individuals and entities in connection with the alleged scheme.
Accused’s position
The article provides no account from the accused disputing the allegations.
- Alleged amount raised
- ₹2,459.49 crore
- Investors reportedly affected
- More than 35,000
- Promised returns
- 3% monthly, plus a 0.5% commission for referring investors
- Unrepaid investor principal
- ₹2,125.60 crore, according to the ED
- Stock-market net losses
- ₹185.95 crore, according to the ED
- Funds frozen
- ₹2.02 crore in bank balances and fixed deposits
- Complaint filed
- October 9, before the III Additional District and Sessions Court in Mangaluru