Real estate firms dupe public

By SNV Sudhir

Visakhapatnam, Sep 11, 2012: Fraudsters have found a new way to dupe gullible people and make money. Promising vacant plots at a cheap price, many real estate firms are either collecting huge amounts in the form of deposits, promising repayment every month along with high interest, or easy installments as low as Rs.25 per day.

There are at least 20 real estate firms that are operating money deposit schemes, violating the norms. According to an agent of a real estate firm with its head office in Dwarkanagar, they collect around Rs.1 lakh against the registration of a 100 sq yard plot in their venture in S Kota on the border of Vizag and Vizianagaram districts. At the time of deposit, they promise to pay the customer Rs.3,500 every month for three years along with the registration of the plot, which is done at the time of receiving the deposit. After three years a customer gets back more money than paid initially and also a valuable plot, said the agent. The agent agreed that the layout does not have LRS approval from Vuda as the registration is done at the panchayat level. The agents also promise to open bank accounts and deposit the monthly pay back amounts. But in reality the firms register agriculture land without getting clearances under land conversion provisions. They convince the customers that it will not be difficult if a group of them approach the authorities after registration. Often, such pleas are turned down by authorities who ask purchasers to pay hefty amounts as conversion charges.

Visakhapatnam police recently arrested the managing director of My Home Ventures who promised a 100 sq yard plot for a daily payment of Rs.25 for three consecutive years. Investigations by police revealed that real estate firm promised disputed sites owned by others. The managing director of the firm collected around Rs.3 crore on a daily basis from more than 600 gullible customers.

Without a proper complaint, we cannot initiate action against such firms. These kind of transactions or activities do not come under our purview and our hands are tied. Of course we will jump into action once someone lodges complaint with us, said a senior police official.