Hyderabad: V.C. Sajjanar, the Police Commissioner of Hyderabad—the capital of Telangana—announced that 32 individuals have been arrested in connection with a fraud case involving Qnet. The arrested group includes 11 women. This syndicate had been defrauding thousands of people across the country, swindling crores of rupees through a scheme referred to as ‘Chain Magic.’
He stated that 68 cases have been registered in the state against fraudulent operations being conducted under the guise of a direct selling company. The fraud specifically targeted IT professionals and unemployed youth. He further noted that four additional cases have been registered recently.
Under the leadership of SB Joint CP Vijay Kumar, the CCS and SIT police formed 27 teams and conducted simultaneous search operations across the states of Andhra Pradesh, Telangana, and Karnataka, leading to the subsequent arrest of the accused. Sajjanar provided these detailed particulars regarding the cases during a press conference held on Monday at the CP’s office in Basheerbagh, Hyderabad.
The accused company placed advertisements on social media—ostensibly for direct selling—claiming that individuals could earn supplementary income by investing in e-commerce businesses across Andhra Pradesh, Telangana, Karnataka, and various African nations. IT professionals were predominantly selected as targets for this scheme. Those who expressed interest were advised to secure personal loans from Fintech firms at interest rates ranging from 19 to 22 percent.
The CP explained, “Without ever explicitly mentioning the name ‘Qnet,’ they would claim that investing in the e-commerce business could generate a monthly income. They led victims to believe that an investment of ₹5–10 lakhs would yield a profit of ₹3–4 crores within two years. Instead of actual financial returns, the victims were sent gifts. At times, items such as Ayurvedic products, biscuits, and honey were distributed as gifts. Additionally, they were sent on international vacations as part of ‘special offers’.” At the time of handing over cash, they would have the investors sign an affidavit stating that they were making the investment of their own free will. They would record a video of the investors reading this document and save it. If the investors requested a refund of their money, they were asked to recruit new members. The 32 arrested accused hail from Hyderabad, Mahabubnagar, Bellampalli, Warangal, Visakhapatnam, Eluru, Nellore, Nandyal, Narsipatnam, and Odisha.
