Finance Fraud – Kanpur Police Bust Rs 146 Crore Fake Firm Network
Finance Fraud – The Kanpur Police Commissionerate has uncovered a massive financial fraud network allegedly linked to fake companies, illegal banking operations, and tax evasion activities spread across multiple states in northern India.
The Kanpur Nagar Commissionerate on Friday arrested Mahfooz Ali, popularly known as “Pappu Chhuri,” from the Jajmau locality for his alleged involvement in a financial scam worth nearly Rs 146 crore. Investigators believe he played a key role in operating a large network of shell firms and suspicious money transactions.
Fake Firms Allegedly Opened Using Labourers’ Documents
According to police officials, the racket functioned by creating fake business entities with the help of PAN cards belonging to semi-literate labourers. Authorities said these documents were allegedly misused to establish firms that existed only on paper while carrying out high-value financial transactions.
The operation was exposed during a joint investigation conducted by the Chakeri Police Station team, the Cyber Cell, and the Surveillance Unit. Officers traced several suspicious financial activities connected to multiple bank accounts and GST registrations.
Transactions Routed Through Multiple Accounts
Police said Mahfooz Ali allegedly opened around 68 bank accounts using the names of his relatives and associates. Investigators found that one company, identified as “Afisa Enterprises,” was used to route transactions amounting to approximately Rs 146 crore.
Officials stated that the money circulating through these accounts was reportedly connected to the scrap trading and slaughterhouse business sectors. Police believe cash withdrawals were regularly made and the money was later returned to firms involved in the transactions after deducting a commission amount.
Lawyer Named as Key Figure in the Network
During the probe, investigators also identified an advocate, Firoz Khan, as an alleged central figure in the operation. Police claim he assisted in setting up fraudulent GST-registered firms that were later used for illegal financial activities.
Authorities confirmed that at least six criminal cases are already registered against Mahfooz Ali. Police teams are now conducting raids and searches to locate other accused individuals connected to the network, including Firoz Khan and several suspected beneficiaries.
Police Link Case to GST Evasion and Hawala Operations
Kanpur Police Commissioner Raghubir Lal told reporters that the investigation has revealed links to GST evasion, fake invoicing, income tax fraud, and hawala-style cash circulation. He said several traders associated with the scrap and slaughterhouse sectors allegedly participated in the movement of unaccounted money.
The Commissioner added that names of multiple beneficiaries, including Tahir, Ajmeri, Rustam, and others connected to the transactions, have surfaced during the inquiry. Notices have already been issued to several individuals, while five accused persons have been sent to jail so far.
Probe Expands Across Several States
Police officials stated that the case widened after investigators examined a robbery incident reported on February 1, which allegedly exposed illegal cash dealings connected to the racket. During that investigation, five suspects were arrested and cash worth Rs 11 lakh was recovered.
Authorities said the financial network appears to extend beyond Uttar Pradesh and may involve operations in Punjab, Himachal Pradesh, Delhi, and West Bengal. Investigators are currently examining transactions conducted through several banks and verifying the identities of individuals linked to the accounts.
Officials from the GST and Income Tax departments are also assisting in the investigation as authorities continue to track the flow of funds and identify the complete extent of the alleged fraud operation.