Two men arrested for gold loan fraud

Bengaluru, Nov 4 (PTI) Two men involved in cheating people with a "zero per cent interest gold loan" fraud scheme were arrested and gold and silver articles worth Rs 1.8 crore were seized, police said on Tuesday.

The arrests was made by the Central Crime Branch (CCB) of Bengaluru City Police, they said.

According to police, the main accused had opened a jewellery shop in Vidyaranapura, advertising "zero per cent interest gold loans" to attract the public. Believing the false advertisement, many customers pledged their gold ornaments and took loans.

However, they were given only 50-60 per cent of the actual value of the pledged gold and were told not to redeem their jewels for at least 11 months.

During this period, the accused illegally sold the pledged gold to another jeweller, earning a profit of 40-50 per cent. Under this fraudulent scheme, a total of around four kg of gold was misappropriated. After 11 months, the accused closed the shop and absconded, confirming the fraud, a senior police officer said.

Two weeks ago, the main accused was traced and arrested from his residence in Peenya in Bengaluru, he said.

Subsequently, police said they seized 1.478 gm of gold ornaments and five kg silver items, from the jewellery shop in HRBR Layout that had been pledged illegally.

The total value of the seized property is approximately Rs 1.8 crore, they added.

The second accused in the case was also arrested, police said.

"Preliminary investigation has revealed that the accused had carried out similar fraudulent activities in Mangaluru district and in Kerala. Further investigation is underway," the officer said.

Following the incident, the Bengaluru City Police has issued a public advisory advising people to verify the authenticity and license of the financial institution before pledging gold.

"Do not fall prey to deceptive schemes such as zero per cent interest loans. If any suspicious or fraudulent schemes are noticed, please inform the nearest police station or CCB Economic Offences Wing immediately," it added. PTI AMP SA