December 16, 2021 In Explained, Noida-based

‘Bike Bot’ scam explained: How Noida-based firm duped 2 lakh investors of Rs 15,000 crore

A new scam, much bigger than the infamous Punjab National Bank (PNB) scam, has been unearthed by the Central Bureau of Investigation (CBI). The ‘Bike Bot’ scam, being operated from Uttar Pradesh’s Noida, is estimated to be worth over Rs 15,000 crore.

The CBI believes that Sanjay Bhati, a resident of UP, allegedly duped over two lakh investors to the tune of Rs 15,000 crore through a very simple investment scheme.

But how did he manage to commit such a big fraud? Well, it all started in the year 2010.

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Sanjay Bhati, the alleged mastermind, along with his family members, incorporated a real estate company by the name of ‘Garvit Innovative Promoters Limited’ on August 20, 2010. The company was being run from Greater Noida with almost negligible business.

With the intention of making quick money, Sanjay Bhati, through his firm, in the month of August 2017, launched a scheme – ‘BIKE BOT – THE BIKE TAXI POWERED BY GIPL’.

How did scheme work?

According to the scheme, investors had to pay for a motorcycle that was supposed to be used as a two-wheeler taxi. In exchange, the investors were promised a massive return on their investment.

Each investor was asked to pay Rs 62,100 for one bike. An EMI of Rs 5,175 per month was fixed and the rental was fixed at Rs 4,590 per bike per month. The scheme also included a monthly rental income bonus of five per cent per bike, along with a matching income of 10 per cent.

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Sources say if the customers invested in one bike at a rate of Rs 62,000, the company was promising a return of over Rs 1.17 lakh per annum. The investors were free to invest in as many bikes as they desired.

To win the trust of investors, Sanjay Bhati’s firm also signed an agreement with the investors giving the impression that their money was safe and the return on their investment would not go anywhere.

“To extract money from investors in less amount of time, the company, with ill-motive, made advertisements that the ‘BIKE BOT – THE BIKE TAXI POWERED BY GIPL’ scheme will be enclosed very soon and that persons can avail this scheme and must deposit money hurriedly,” an official familiar with the probe told India Today.

The fallout

The nearly two lakh investors who participated in the scheme approached the police and filed complaints against Bhati and his firm when they did not receive the returns promised to them.

According to CBI officials, it is suspected that the fraudulent activity of the company was in the knowledge of the Noida district authorities as well as police authorities. However, no action was taken against any of those involved.

The CBI investigators also suspect that senior ranking officials of the Noida Police pressurised the complainants to withdraw their complaints.