Bengaluru: A major financial fraud involving crores of rupees has come to light in Bengaluru, with several investors from Dakshina Kannada among those allegedly cheated through a fake AI-based trading scheme.
Police have identified the accused as Rajesh Kamat, Madhu, and Nageshappa, who are said to have operated under the name Crystal AI Robot Trading Platform.
Fake AI trading promise used as bait
According to investigators, the accused lured investors by promising unusually high returns, claiming that their “AI-powered trading system” could double investments within 200 days.
Such claims attracted a large number of people, including individuals from Dakshina Kannada district and even investors based abroad. Many were reportedly convinced by the use of technology-driven terminology and assurances of consistent profits.
Office set up to gain credibility
To establish legitimacy, the accused had reportedly set up an office near Kengeri railway station in Bengaluru. This physical presence helped build trust among potential investors, making the scheme appear genuine.
Victims were persuaded to invest substantial amounts, often encouraged by initial assurances and the apparent scale of operations.
Multi-level marketing model uncovered
Police said the fraud operated through a chain-linked multi-level marketing (MLM) structure, with nearly 50 agents involved in mobilising funds from the public.
These agents played a key role in expanding the network, recruiting new investors and collecting funds, thereby sustaining the scheme over a period of two to three years.
Authorities believe this structure enabled the accused to reach a wide pool of victims across Karnataka and beyond.
Operations shifted, foreign links suspected
Investigators revealed that the accused later shut down direct operations and continued the scheme through a network-based model, making it harder to trace transactions.
Police have also indicated possible links to Dubai, suggesting that part of the operation or fund movement may have extended overseas.
Further details are expected to emerge as the investigation progresses.
Victims from DK among those affected
A significant number of victims are reported to be from Dakshina Kannada district, highlighting the widespread impact of the fraud. Several overseas investors are also believed to have suffered losses.
Authorities are currently assessing the total amount involved and identifying all those affected.
Investigation underway
Police have launched a detailed probe into the case, focusing on tracing financial transactions, identifying accomplices, and recovering funds where possible.
They have also urged the public to remain cautious of schemes promising guaranteed high returns, especially those using complex technological claims without transparency.
Conclusion
The Bengaluru AI trading scam underscores the growing risk of financial frauds leveraging emerging technologies to mislead investors. Authorities have reiterated the importance of verifying investment platforms and avoiding schemes that promise unrealistic returns.
As the investigation continues, officials are working to bring those responsible to justice and prevent similar frauds in the future.