Is SM Trade, a New Ponzi Scheme, Spreading Wings in and around Powai in Mumbai?
Investors baffled with dwindling interest rates on deposits, especially amidst the COVID pandemic, are desperately searching for better returns on investment. No wonder, there is a spurt in 'get rich quick' schemes and scams that are luring such investors. There is one such entity SM Trade (Shree Mahakali Trade), which is promising huge returns on investment.
SM Trade is said to be a company operated by Ritesh Panchal aka Ritesh Sikligar. He claims to deal in stock market trading; trades in futures to make money, and uses options to hedge and insure.
According to our sources, SM Trade and Mr Panchal have already lured several retired people, mainly from the Indian Institute of Technology (IIT Bombay) and nearby area under the pretext of giving good returns on investing money with him.
For example, if someone invests Rs1 lakh with SM Trade or with Mr Panchal and uses Rs25,000 for a trade, that investor would receive 5% return on the unused amount of Rs75,000. He also operates Kreaz Life, through which he offers Rs3.33 crore returns in three months on an investment of Rs1,000. "He guarantees this and is ready to put it on an agreement," our source says.
Mr Panchal claims to have his own brokerage and partnership with Samco and Upstox. He is involved in Paiselogy, a multi-level marketing (MLM) scheme. Moreover, he has Smart Trade and Ovule, which deal in cash futures & options (F&O) and everything happens here in cash, our source says.
SM Trade also offers a 10% commission for bringing a new client.
Last month, Mr Panchal started Shree Mahakali Credit Co-operative Society (patpedhi) in Powai. The invitation card for the opening ceremony mentions the name of Manoj Kotak, the local member of Parliament (MP) as chief guest. However, the Twitter timeline of Mr Kotak has no mention of him attending the inauguration of the patpedhi on 20 December 2020.
According to our sources, Mr Panchal claims to have a diversified business profile and numerous sources for making money and he has been doing this for at least eight years. "He (Mr Panchal) says he was associated with some college in Gujarat as can be seen from a video on his YouTube channel
. He got contacts of some people from IITB and that is how he started his business in the campus," our source says.
One of the investors was told by his neighbour (who has invested his money in SM Trade) that he receives Rs2,000 via cheque every Tuesday as interest on his investment of Rs1 lakh. The investor-neighbour also told that the trader works with 'angadiyas' to justify such high returns.
Mr Panchal of SM Trade also signs a standard agreement with investors. However, there is no mention of any interest rate or percentage of profit sharing mentioned in the agreement seen by Moneylife.
The investor was also told by Mr Panchal about assets under his management. "He was hesitant initially, but said Rs17 crore, on paper, excluding cash transaction and black money. Then, I asked how much I can invest to which he replied minimum Rs10,000 and no maximum limit. He said he is the sole owner of this business, SM Trade," the investor says.
We sent emails to Mr Panchal seeking details of investments schemes or plans offered by SM Trade and its registration number or certificate obtained from Securities and Exchange Board of India (SEBI) or any other government authority. There is no response from SM Trade or Mr Panchal.
We also sent an email to SEBI to know if SM Trade or Mr Panchal is a registered entity for collecting money from investors for trading. We have not received any reply from SEBI. We will update this article as and when we receive any reply from Mr Panchal or SEBI.