Crime Branch Advisory
The Nigerian Scam
Conmen in Rs 400m SMS scam arrested
06 March 2007
MUMBAI: The alleged mastermind behind
a Rs 400 million SMS fraud that duped at least 50,000 people has
been arrested along with an associate more than two months after
the scam was unearthed.
Jayanand Nadar, 30, and Ramesh Gala,
26, were arrested late on Monday from a hotel in Mira Road in the
western suburbs. Nadar, a first year college dropout, along with
his brother Jayaraj had allegedly duped at least 50,000 people of
Rs.400 million, said officials in the city police's Economic Offences
The two brothers along with Gala
allegedly took help of SMS technology and launched the first-of-its-
kind SMS fraud in India.
According to EOW sources, in August
2006 the duo launched an aggressive and catchy advertisement campaign
in the print media that read: "Nothing is impossible. The word
itself is: I M Possible."
As part of the attractive scheme,
the Nadar brothers messaged random numbers, asking people interested
in 'earning Rs.10,000 per month' to contact them.
"The modus operandi adopted
by the brothers was alluring," an EOW official said Tuesday.
"Interested 'subscribers' were
asked to deposit Rs.500 each. The conmen duo claimed o be working
with a US-based company named Aropis Advertising Company, which
wanted to market its client's products through SMS'," senior
inspector A Thakur said. "The brothers even put up a website
to promote their scheme. Subscribers who registered with them received
about 10 SMS' every day about various products and were promised
handsome commissions if they managed to rope in more subscribers
by forwarding the messages," Thakur said.
In return, the Nadars promised to
pay Rs.10,000 over 16 months to the investors. The amount was to
be paid in instalments of Rs.1,000 every few months.
The brothers are said to have told
the subscribers that their American clients wanted to conduct a
study about local response to their advertisement and were using
SMS as it was the latest medium of communication.
The duo invited people to become
agents and get more members for the scheme. Gala reportedly looked
after the accounts.
Initially, the brothers paid up
small amounts. But when cheques and pay orders of larger sums issued
by the duo were not honoured, the agents got worried. The SMSes
too suddenly stopped.
On November 30, one of the duped
agents approached the DN Road police station and lodged a complaint
after a bank failed to honour a pay order amounting Rs.2.17 million
issued by the Nadar brothers.
Then suddenly, the Nadars and Gala
disappeared, leaving their agents and investors in the lurch.
By December, the police were flooded with similar complaints. The
DN Road police station registered a case against the brothers and
Gala and later transferred it to the EOW.
"By December 2006 the scheme
had an over 50,000 membership in Mumbai alone. And we suspect that
hundreds of thousands from across the country were also hooked to
the scheme, thanks to a massive agent network and a door-to-door
campaign carried out by the firm's now duped agents," Thakur
"We suspect that the fraud
amount may be over Rs.1 billion. With the extent of the scam spread
across the country, we are still trying to get the details."
During investigations, the EOW came
to know that the Nadars, residents of the upmarket Juhu-Tara Road,
owned a fleet of imported sport utility vehicles and sedans.
"The brothers led an extravagant
life. They would stay in top five star hotels, throw massive parties
for investors and were also known faces in the city's Page-3 circuit,"
"We are now looking for Jayaraj,
who has eluded arrest. Gala, who is believed to have looked after
the accounts, and Jayanand have been remanded to police custody
till March 5."