Over 300 people cheated of Rs 200 crore in Bengaluru real estate fraud

The firm convinced customers that if they invested their lease deposit money with them, it would arrange rental houses for them and pay the monthly rent on their behalf.

Bengaluru: A major real estate fraud involving more than Rs 200 crore has come to light in Bengaluru, where people searching for houses on lease were allegedly cheated by a private intermediary firm promising rental support and investment returns.

The case involves a company named Johns Asset, against which allegations of cheating more than 300 people have surfaced. The firm’s owner, Stephen John, is currently absconding, according to police.

Based on complaints filed by victims, the Indiranagar Police Station has registered a case and launched a search operation to trace the accused.

According to investigators, the company allegedly exploited the shortage of lease houses in Bengaluru by targeting people looking for accommodation. The firm reportedly convinced customers that if they invested their lease deposit money with the company, it would arrange rental houses for them and also pay the monthly rent on their behalf.

Believing the offer, several people deposited large amounts ranging from Rs 10 lakh to Rs 75 lakh with the company. Victims claim the company initially paid rent for a few months to gain trust, but later stopped payments and began avoiding customers.

One of the complainants, Gayathri, alleged that her family had invested Rs 37 lakh with the company after being assured of monthly benefits and secure housing arrangements. She said the company initially failed to pay rent to the house owner, resulting in pressure to vacate the property.

“When we demanded our money back, the company refused and instead promised four percent monthly interest on the amount. We trusted them and reinvested the money. They paid for only two months and later stopped completely,” she alleged.

Police suspect Ponzi scheme

Police suspect the accused operated the business in a Ponzi scheme-like manner, where money collected from new customers was allegedly used to make payments to earlier investors. Investigators believe the scheme continued until the company collapsed.

Sources said Stephen John had previously been arrested by the Central Crime Branch in connection with another cheating case. However, he allegedly resumed operations under a new company name and continued collecting money from customers.

The office of the company has now reportedly been shut down, and victims claim the accused fled with crores of rupees. Dozens of affected investors gathered at the Indiranagar police station seeking action and recovery of their money.

Police officials said further investigation is underway to identify the total amount involved and trace the financial transactions linked to the alleged fraud.