Recently, the Enforcement Directorate (ED) of India announced that Harsatinder Pal Singh Hayer, the son-in-law of the late founder of Pearls Group, Nirmal Singh Bhangoo, has been formally arrested for his alleged involvement in a Ponzi scheme amounting to 480 billion rupees (approximately 41.6 billion yuan). This case is considered one of the largest financial frauds in Indian history.
The Family Fraud Network Comes to Light
Nirmal Singh Bhangoo was the founder of PACL (Punjab Agro Company Limited), who attracted over 55 million investors through false agricultural land investments and promises of high returns. He was arrested by the Central Bureau of Investigation (CBI) of India in 2016 and passed away in August 2024.
However, Bhangoo's family members did not cease their fraudulent activities; his son-in-law Hayer, daughter Balinder Kaur, and wife Prem Kaur took over the management of the company. They established new companies with directors who were their relatives, servants, and drivers, using these newly formed companies to defraud investors.
Massive Agent Network Operations, Huge Funds Flow to Australia
PACL utilized a vast network of up to 2.3 million agents, promising investors high returns and land investment opportunities, thereby deceiving a significant amount of funds.
In 2015, the Securities and Exchange Board of India (SEBI) found the company guilty of illegal fundraising and ordered the freezing of all its assets. Nevertheless, Bhangoo and his family continued to operate funds through multiple associated companies.
The investigation by the Enforcement Directorate found that Australian entities controlled by Hayer, such as Pearls Australasia Pty Ltd and Australasia Mirage I-Pty Ltd, became channels for laundering the scam money. A total of 6.5718 billion rupees (approximately 570 million yuan) of "illicit gains" were transferred to these Australian companies and used for local real estate investments.
Freezing 7.06 Billion Rupees, to Compensate Victims
As of now, the Enforcement Directorate has seized assets worth 7.06 billion rupees (approximately 610 million yuan), including:
• Australian properties: two real estates, valued at 4.62 billion rupees (approximately 400 million yuan);
• Domestic assets in India: valued at 2.44 billion rupees (approximately 210 million yuan).
These assets will be used to compensate the victims, supervised by the RM Lodha Panel appointed by the Supreme Court of India.
Hayer Arrested, Litigation Continues to Progress
On July 16, 2020, the police filed cases against 55 suspects, including members of the Bhangoo family, involving charges of fraud, criminal conspiracy, and other accusations from various departments in India.
Now, with the arrest of Hayer, the investigation of the case continues.
