The Enforcement Directorate has arrested Sudhir Dalsukhbhai Kotadiya and Umang Santibhai Kotadiya in connection with an alleged ₹183-crore online Ponzi scheme linked to QFON App Limited and its related entities.
The arrests were made on March 11 under the Prevention of Money Laundering Act, 2002. The two were produced before a special court in Mumbai, which remanded them to ED custody for eight days, until March 20, for further investigation.
The case stems from an FIR registered in December 2024 in Thane. The complaint alleged that Sudhir Kotadiya, Umang Kotadiya, Jaysukh Sakhariya and others ran a fraudulent digital investment scheme that collected large sums from investors in Gujarat and Maharashtra.
The FIR invoked provisions of the Indian Penal Code and the Maharashtra Protection of Interest of Depositors Act, 1999.
According to investigators, the accused lured investors through a mobile application operated by QFON App Limited, promising unusually high returns ranging between 2% and 10.5%. The platform claimed that users could earn money by performing digital tasks such as viewing online advertisements through the app.
However, investigators found that the business model lacked any genuine revenue stream. Instead, funds collected from new investors were allegedly used to pay returns to earlier investors, a typical feature of Ponzi schemes. Authorities also suspect that a portion of the funds was siphoned off by the accused.
The ED said the money was routed through multiple bank accounts belonging to companies, firms and individuals linked to the accused. Some funds were also allegedly transferred through informal cash channels using angadiya operators. Investigators estimate that proceeds of crime worth around ₹183 crore were generated through the scheme.
Officials said the two accused had been absconding during both the police probe and the ED investigation. Authorities later found that they had fled to Dubai and subsequently re-entered India through Nepal.
Following sustained surveillance and intelligence inputs, ED officials tracked their movements and arrested them on March 11.
Earlier searches conducted by the agency at multiple locations led to the seizure of documents, digital devices and financial records. Investigators also recovered cash worth ₹2.51 crore during the operations.
The ED said further investigation is underway to trace additional assets, identify other individuals involved in the scheme and determine the full extent of the financial trail.
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