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Bharathi Builders Arrested for Alleged Pre-Launch Offer Fraud in Hyderabad

Bharathi Builders Arrested for Alleged Pre-Launch Offer Fraud in Hyderabad

In a cautionary tale for potential property investors, Hyderabad’s Economic Offences Wing (EOW) Police arrested three individuals associated with Bharathi Builders, a real estate development firm. The arrests stem from allegations of a fraudulent pre-launch offer scheme for apartments in Kompally, a suburb located in the Medchal-Malkajgiri district.

Modus Operandi of the Alleged Scheme

According to the EOW Police, Dupati Nagaraju and Mulpury Shivarama Krishna established Bharathi Builders in Madhapur, Hyderabad in 2021. They acquired land in Kompally with the intention of constructing a residential complex named “Bharathi Lake View.”

The alleged fraud involved enticing prospective buyers with a pre-launch offer for apartments priced at Rs 3,200 per square foot. Eye-catching brochures and meetings were reportedly used to attract investors and collect deposits.

To further their plan, Nagaraju and Krishna appointed Thoddakula Narsimha Rao as CEO of Bharathi Builders, allegedly offering him a significant commission on each flat sale to incentivize aggressive marketing.

Allegations of Fraud and Police Action

Police reports indicate that over 350 individuals, including the complainant BVS Prasada Rao, invested a collective sum of Rs 50-60 crores under the pre-launch offer scheme.

However, after successfully collecting deposits, Bharathi Builders allegedly failed to deliver on their promises. No construction on the apartments began, and the promised flats were never delivered. Furthermore, investigators believe the company sold the entire acquired land parcel to another party for a reported sum of Rs 100 crores.

Based on these allegations, the EOW Police registered a case against Bharathi Builders under sections 406 and 420 of the Indian Penal Code (IPC), which deal with criminal breach of trust and cheating respectively. Additionally, a case was filed under Section 5 of the Telangana Protection of Depositors of Financial Establishments Act (1999).

The arrests serve as a stark reminder of the importance of due diligence for potential property investors.

Public Advisory and Next Steps

The Cyberabad EOW Police urge the public to exercise caution with pre-launch offers in the real estate sector. They advise against investing or depositing money in such schemes without thorough research and verification. If any suspicious activity or investment scheme is identified, the authorities recommend reporting it immediately.

The EOW Police have expressed their commitment to pursuing legal action against perpetrators of such frauds and ensuring justice for the victims.

Cyberabad EOW Arrests Trio in Major Real Estate Fraud Case

The Cyberabad Economic Offences Wing (EOW) police have arrested three individuals for their involvement in a significant cheating case tied to a pre-launch offer of residential apartments at ‘Bharathi Lake View’ in Kompally, Medchal-Malkajgiri district. The case, registered under Crime No. 10/2024, involves charges under Sections 406 and 420 of the Indian Penal Code and Section 5 of the Telangana Protection of Depositors of Financial Establishments Act, 1999.

Key Figures in the Fraudulent Scheme

The accused, identified as Dupati Nagaraju, Chairman of M/s Bharathi Builders, Mulpury Shivarama Krishna, Managing Director of M/s Bharathi Builders, and Thoddakula Narsimha Rao, CEO of M/s Bharathi Builders, have been apprehended. This arrest follows a complaint filed by B.V.S Prasada Rao, a victim of the scam.

The Genesis of M/s Bharathi Builders

In 2021, Dupati Nagaraju and Mulpury Shivarama Krishna founded M/s Bharathi Builders in Madhapur, Hyderabad. They acquired 6.23 acres of prime land in Kompally, intending to develop it into residential apartments named ‘Bharathi Lake View’. However, their plans took a deceptive turn.

The Deceptive Pre-Launch Offer

To fund their project, Nagaraju and Krishna launched a pre-launch offer, promoting the flats at Rs. 3,200 per square foot. They produced enticing brochures and held promotional meetings in Kompally and their Madhapur office. The scheme attracted many prospective buyers, who were promised significant returns.

The Role of the CEO and the Scam Unfolds

Nagaraju and Krishna appointed Thoddakula Narsimha Rao as CEO of Bharathi Builders. Rao’s role was crucial in attracting deposits by offering hefty commissions on flat sales. The scheme successfully lured approximately 350 individuals, including complainant B.V.S Prasada Rao, resulting in deposits totaling around Rs. 50-60 crores.

The Betrayal and Fraudulent Sale of Land

Despite collecting substantial deposits, the accused did not commence construction or deliver the promised apartments. Instead, they sold the entire 6.23-acre plot, valued at approximately Rs. 100 crores, to another party, thereby defrauding the depositors.

Public Advisory from Cyberabad EOW

In light of this incident, the Cyberabad EOW police have issued a warning to the public, advising against investing in or depositing money into pre-launch offers. They urge individuals to report any dubious investment schemes or real estate transactions to the authorities. The department remains committed to prosecuting the fraudsters and securing justice for the victims.

Ongoing Investigation

The investigation is being led by Inspector of Police, J. Venkateswarlu, from the Economic Offences Wing Police Station, Cyberabad, under the supervision of Deputy Commissioner of Police, K. Prasad, EOW, Cyberabad. The authorities are diligently working to unravel the full extent of the fraud and ensure the perpetrators face legal consequences.

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