ED Attaches ₹110 Crore Assets in Prayag Group Money Laundering Case

ED Attaches ₹110 Crore Assets in Prayag Group Case, Exposes Scale of Illegal Deposit Mobilisation

The Enforcement Directorate’s latest action against the Prayag Group of Companies offers a stark illustration of how large-scale financial deception can grow in plain sight when regulatory checks fail and investor trust is exploited over years. Acting through its Kolkata Zonal Office, the agency has provisionally attached assets worth ₹110 crore, marking a significant escalation in a case that spans millions of small depositors and thousands of crores in alleged illegal collections.

According to investigators, the Prayag Group built its business on unauthorised deposit and money circulation schemes that promised high, assured returns without approval from any financial regulator. Between its flagship entities, Prayag Infotech Hi-Rise Ltd. and Prayag Infotech Network Pvt. Ltd., the group is accused of mobilising ₹2,863 crore from nearly 3.9 million investors across several states. By March 2016, unpaid depositor liabilities alone stood at ₹1,906 crore, excluding interest—an amount that reflects the human scale of the alleged fraud.

The ED’s investigation suggests the operation followed a familiar but devastating pattern. Funds collected from new investors were allegedly used to pay earlier ones, creating the outward appearance of a functioning enterprise while masking the absence of any sustainable business activity. As inflows slowed, the structure collapsed under its own weight, leaving lakhs of depositors exposed.

Where the case sharpens further is in the alleged use of investor money. Investigators say substantial portions of the funds were diverted away from any stated business purpose and channelled into land purchases, hospitality ventures, film city projects, company takeovers and aggressive advertising campaigns. Celebrity endorsements and agent commissions, officials allege, helped reinforce credibility while masking the underlying financial vacuum.

The probe has also focused on personal enrichment. ED officials state that group promoters Basudeb Bagchi, Avik Bagchi and Swapna Bagchi withdrew large sums as salaries and remuneration, acquired properties in their own names and routed funds through connected entities to obscure the trail. Share allotments without consideration and layered transactions, the agency claims, were used to consolidate control over assets generated from what it describes as proceeds of crime.

The provisional attachment order covers more than 450 acres of land with superstructures spread across West Bengal, Bihar and Assam, valued at approximately ₹104 crore, along with additional personal properties worth about ₹6 crore held by the promoters. The purpose, the ED has said, is to prevent dissipation of assets while judicial proceedings continue.

Basudeb Bagchi and Avik Bagchi are currently in judicial custody, and a prosecution complaint has already been filed before the special PMLA court. Investigators indicate that the case remains open-ended, with further tracing of funds, additional attachments and supplementary complaints likely as financial forensics progress.

Beyond the immediate legal action, the Prayag case highlights a deeper governance problem. Illegal deposit schemes of this scale rarely thrive without prolonged gaps in oversight, weak internal controls and delayed intervention. Forensic reviews of such collapses often resemble post-mortems of systems that failed to ask basic questions early enough—questions typically addressed through independent scrutiny and controls similar to those emphasised in professional auditing services in india when complex financial operations are examined before they spiral beyond recovery.

For investors, the episode is another reminder that assurances of guaranteed returns outside the regulatory framework carry disproportionate risk. For enforcement agencies, it reinforces the challenge of unwinding years of financial layering after public money has already changed hands. And for the broader financial system, it underlines how costly delayed accountability can be—measured not just in crores attached, but in trust eroded across millions of households.