The Enforcement Directorate’s Nagpur unit recently conducted search operations under the provisions of the Prevention of Money Laundering Act, 2002 (PMLA), targeting the promoters and directors of KBC Multi-trade Private Ltd.
Commencing on March 8, the ED’s operation targeted eight official and residential premises of the company’s promoters and directors in Nashik and Thane. Subsequently, on March 11, a bank locker registered to an individual named Sanjay Panchariya, located in Anand Nagari Sahakari Patsanstha Maryadit, underwent scrutiny. During these searches, documents relating to 20 properties with an estimated value of ₹62 crore were seized.
Following the seizures, the ED placed freezes on bank accounts containing ₹16.6 crore in cash, demat account balances totaling ₹44.61 lakh, and post office savings of ₹5.56 lakh. Additionally, gold and diamond jewellery valued at ₹30.75 lakh were confiscated. Furthermore, under Section 17(1A) of the PMLA, restraining orders were issued for four lockers suspected to hold proceeds from illicit activities.
An ED official explained, “The investigation stemmed from multiple FIRs filed by the Maharashtra Police in Parbani, Nashik, and other districts, citing various sections of the IPC, 1860, against KBC Multi-trade Private Ltd. and its promoters, Bapu Chhabu Chavan, Bhausaheb Chhabu Chavan, and Arti Bhausaheb Chavan. The Chavan family, in collaboration with principal agents of the company, orchestrated a scheme under the guise of an MLM (Multi-level Marketing) endeavor, operating through KBC Multi-trade Private Ltd. and KBC Club and Resorts Pvt Ltd. They enticed the public with promises of attractive returns on investments, amassing over ₹200 crore through deception.”
The investigation uncovered that individuals were induced to become members by paying fees under various schemes offered by KBC Multi-trade Private Ltd. and KBC Club and Resorts Pvt Ltd. These schemes included assurances of binary and matrix commissions, awards, rewards, and product gifts.
“The commission structure obliged all members to recruit more individuals, as a portion of the subscription fees was distributed among those at the top of the pyramid. It was further revealed that Bapu Chhabu Chavan, Bhausaheb Chhabu Chavan, Arti Bhausaheb Chavan, and other accomplices utilized the membership fees collected from the public to acquire immovable assets, gold jewellery, and investments in shares. The investigation remains ongoing,” elaborated ED officials.
