How Operation Mobilisation Charity Group charged students full fees and pocketed foreign sponsorships

Hyderabad: ED has attached 12 immovable properties valued at Rs 3.58 crore in connection with the misappropriation of funds case involving Operation Mobilisation (OM India) Group of Charities under the Prevention of Money Laundering Act, 2002.

Enforcement Directorate took the action based on the investigation into alleged large-scale misappropriation of tuition fees, ancillary charges collected from students of Good Shepherd Schools operated across India by the OM India Group of Charities, as well as misappropriation of government-funded RTE and scholarship amounts.

The ED initiated an investigation based on an FIR registered by the EOW, CID, Telangana, for offences under various Sections of IPC, 1860, against OM India entities and its key office bearers.

The current market value of the attached properties is estimated to be around Rs 15 crore.

What is the case about?

The CID uncovered a widespread organised fraud within Operation Mercy India Foundation (OMIF) and affiliated organisations, involving diversion and misappropriation of approximately Rs 296.6 crore in foreign and domestic donations.

Dr Joseph D’Souza, his son Josh Lawrence D’Souza, and other key office bearers systematically diverted funds received from donors, including major Christian charity networks such as Dalit Freedom Network (DFN) USA, Canada and UK, which were ostensibly meant for the education and upliftment of Dalit and marginalised children.

Funds for education and community development were diverted to private accounts

Although the group claimed to provide free English-medium education, community development and rehabilitation assistance, CID found that substantial funds were diverted into private accounts, fixed deposits and real estate transactions.

Forensic audit further revealed large-scale manipulation of student data submitted to foreign donors for student education sponsorship, even though regular tuition fees and other charges were collected from all students and recorded falsely as ‘local donations.’

Funds were meant for the upliftment of marginalised sections

ED investigation revealed that OMIF had received significant foreign sponsorship funds for the education of students from Dalit and other marginalised sections of society, and other ancillary expenses related to the construction and running of the schools.

Searches by ED at OM India offices and residences of key office bearers led to seizure of property documents, financial records and electronic devices.

How additional foreign donations were obtained by inflating student numbers

Examination of the seized material revealed deliberate manipulation in the student sponsorship data aimed at inflating the number of students claimed to be sponsored and justifying receipt of additional foreign donations.

Manipulations in the student data included assigning multiple student codes to the same individual, different student codes for different years, different students under the same code, altering personal details (photographs, dates of birth and parents’ names) and inconsistencies in other parameters like height, class, caste and gender.

Despite the accused persons attempting to withhold historical data, citing retention limitations, seized electronic records revealed that OMIF maintained extensive student datasets spanning several years.

Students charged full fees even though they were fully sponsored on paper

The ED investigation has established that Good Shepherd Schools collected regular fees, book charges, uniform and bus fees from all students, including those represented as fully sponsored, thereby generating proceeds of crime. The schools also received substantial government aid under the RTE and scholarship schemes, yet students were charged full fees.

Government reimbursements were diverted to OMIF’s head office accounts rather than being reimbursed to students.

Between 2011-12 and 2017-18, significant amounts collected from students and received from government sources were concealed from donors who believed they were funding free education. ED has identified Rs 15.37 crores as the proceeds of crime arising out of the diversion of such student collections and government subsidies.

Money from students and parents became ‘local donations’ for church expenditures

Between 2014-15 and 2016-17, expenses on books, uniforms, ties, belts and bus services recorded by OMIF were diverted to Good Shepherd Community Society (GSCS), an entity engaged in religious activities.

These amounts were collected directly from students and parents and recorded by GSCS as local donations, which were subsequently utilised for church-related expenditures and acquisition of immovable properties.

Diverted funds used for foreign travel in business class

ED investigation also revealed that diverted funds were also routed to affiliated entities for their core activities and used for extravagant foreign travel by senior functionaries, including business-class travel by Dr Joseph D’Souza and others.

Diverted funds were further siphoned off by recording bogus expenses and withdrawn in cash, which was used to acquire properties in the personal names of key office bearers and other entities beneficially controlled by them.

What did the key office bearers do?

The investigation has revealed that Dr Joseph Gregory D’Souza, self-proclaimed Archbishop of Good Shepherd churches, exercised overarching spiritual, administrative and strategic control across all group entities, while his son Josh Lawrence D’Souza functioned as the operational and financial head responsible for maintaining manipulated records, managing foreign inflows, coordinating inter-entity transfers and handling donor communications.

It has also emerged that Dr Joseph D’Souza was a founding member of several overseas donor organisations and frequently travelled abroad to mobilise funds for the operations of the Indian entities. Websites of foreign donor organisations were found to be obscured or inaccessible from India, suggesting deliberate restrictions to prevent regulatory scrutiny.

Students shown as ‘joginis’ to procure higher sponsorships

ED investigation further uncovered that the OM India group misrepresented ordinary Good Shepherd School students as ‘joginis’ (sexually exploited temple attendants) to foreign donors to solicit higher sponsorship amounts.

Images of regular students and unrelated kids were uploaded on donor websites and social media, portraying them as joginis, though these children had no such background, and no rehabilitation programme existed.

Donations for ‘jogini rehabilitation’ ranged from $60–68 per month, as compared to $20–28 per month for regular student sponsorship, resulting in higher fundraising based on false representations.

Attempts were made to bypass FCRA rules

Following field verifications, the Ministry of Home Affairs [Foreign Contribution Regulation Act (FCRA) Division] ordered non-renewal of FCRA licences of multiple OM India entities and froze their FCRA accounts for violations of FCRA, 2010.

However, the group leadership, in collusion with foreign donors, adopted alternate methods to receive foreign funds, routing them through OM Books Foundation (OMBF) under the guise of printing-related commercial invoices despite the restrictions imposed under the FCRA.

Further investigation, including identification of additional Proceeds of Crime and the roles of other individuals involved in laundering the diverted funds, is underway.