Hyderabad: CCS busts Rs 24.3 Cr investment scam; `Urban Market’ founder among two held

Hyderabad: Hyderabad’s Central Crime Station (CCS) has busted a Rs 24.3 crore investment scam and arrested two men, including the founder of a purported online grocery startup.

The duo allegedly lured investors with false promises of high returns through a fabricated business scheme, duping hundreds and orchestrating one of the city’s largest tech-related financial frauds in recent years.

The accused—Mukesh Chowdhary (33), founder of Urban Market, and Amit Kumar Pilania (31), a Pune-based businessman—were arrested from Malakpet on May 30. The arrests follow a months-long investigation into what authorities are calling a “pre-planned financial deception disguised as a startup.”

Investor turns accused

Interestingly, Pilania was the original complainant in the case, filed in March 2024 at the Malakpet police station. He alleged that Chowdhary, a long-time acquaintance, misused his name to run the business and pressured him to invest Rs 15 lakh. However, forensic analysis of bank transactions and corporate filings later revealed that Pilania was not just a victim, but an active participant.

“The investigation showed clear financial links between the two accused. This was a joint operation targeting unsuspecting investors,” said a CCS official.

Bogus business model

The accused allegedly used the Urban Market app to solicit funds between 2023 and 2024, presenting it as a high-growth online grocery venture. Dozens of investors were drawn in with promises of exceptional returns, which never materialized. According to police, the business largely existed on paper, with inflated projections and fabricated operations.

Legal action and charges

The case was re-registered by the CCS on April 27 under IPC Sections 417 (cheating), 420 (cheating and dishonestly inducing delivery of property), and 506 (criminal intimidation). Following evidence of widespread investor losses, police also invoked Section 5 of the Telangana Protection of Depositors of Financial Establishments Act. Both Chowdhary and Pilania were produced in court and remanded to judicial custody on May 31.

Ongoing investigation

CCS officials are continuing to track the money trail and identify other possible accomplices. Several genuine victims have come forward, and police are urging others affected by the scam to file formal complaints.

“This case highlights how startup branding is being misused as a front for financial fraud. We're treating this as a serious white-collar crime,” a senior official said.

The Urban Market case has become one of the city's largest tech-linked frauds in recent memory, raising questions about investor due diligence and regulatory oversight in the startup space.