$130 Million Fraud Targeting Indian American Community

HI INDIA NEWS DESK

The Securities and Exchange Commission has obtained a temporary restraining order, asset freeze, and other emergency relief to halt an ongoing fraud of a whopping sum of $130 million targeting the Indian American community. It has been found that the fraud is allegedly conducted by Nanban Ventures LLC, and its three founders namely — Gopala Krishnan, Manivannan Shanmugam, and Sakthivel Palani Gounder.

The SEC’s complaint alleges that the defendants raised more than $89 million from more than 350 investors for investments in purported venture capital funds. The founders managed these funds through Nanban Ventures LLC. More than $39 million was raised from 10 investors that invested directly in the three other entities controlled by the founders. The founders overstated the profitability of the investments and paid investors at least $17.8 million in fake profits that were Ponzi payments.

Krishnan also claimed in a YouTube video that he achieved returns of “more than a hundred percent.”

Gurbir S. Grewal, Director of the SEC’s Division of Enforcement said, “We allege that the defendants engaged in a large-scale affinity fraud that targeted hundreds of investors, largely from the DFW-area Indian American community.” He added, “Through allegedly false promises of unrealistic returns and lies about the success of their investing strategies, the defendants raised nearly $130 million from investors. But in classic Ponzi fashion, the complaint alleges, the defendants used investor money to make fake profit distribution payments, while allegedly siphoning off millions in investors’ funds for themselves. We urge all investors to confirm the credentials of supposed investment professionals and to view investments that advertise outsized returns skeptically.”

The SEC’s complaint charges all defendants with violating the antifraud provisions. The complaint seeks permanent injunctions, disgorgement of ill-gotten gains with prejudgment interest, and civil penalties from all the defendant