A major financial investigation is underway in Belagavi after district administration and cooperation department officials raided offices linked to Shivam Associates, owned by Shivanand Neelannavar, over allegations of operating a Ponzi-style money circulation scheme involving investments worth several thousand crores.
The raids were conducted at two offices in Shiv Basav Nagar on Thursday following directions from Deputy Commissioner Mohammad Roshan. A team led by Assistant Commissioner Shravan Nayak inspected financial records, investment documents, and transactions linked to public deposits. Officials confirmed that several documents have been seized for scrutiny.
Notably, Kannadamma News was among the first media platforms to report on allegations surrounding the suspected Ponzi-style operation and the firm’s deposit collection activities.
What Is the Alleged Scam?
Authorities suspect that Shivam Associates collected money from the public by promising unusually high returns — reportedly around 36% annual interest.
In simple terms, a Ponzi-style scheme works by using money from new investors to pay returns to earlier investors, instead of generating genuine business profits. Such schemes often appear successful initially because early investors receive regular payouts, encouraging more people to invest. However, if fresh investments slow down, the entire system can collapse, leaving investors at risk of losing their savings.
Officials are now examining whether the firm had the required permissions from agencies such as SEBI and RBI to collect public investments and offer such returns.
Preliminary findings suggest nearly 45,000 people may have invested in the firm, including a large number of retired Army personnel and ex-servicemen.
Who Is Shivanand Neelannavar?
Shivanand Neelannavar is known in parts of Belagavi district for organising public events, social programmes, village-level activities, cricket tournaments, health camps, influencers meet and mass lunch events. He is also reportedly involved in businesses such as import-export, commodity trading, real estate, and film production.
He had also produced the 2022 Kannada sports action-drama film Champion under the banner of S.N. Production.
In recent months, Neelannavar gained significant attention on social media because of several controversial speeches and public claims.
At one event, he claimed to possess thousands of guns. In another widely shared speech, he declared that he would win all 224 Assembly seats in Karnataka in 2028 and become the next Chief Minister. During a programme in Belagavi, he also referred to himself as “one of the best human beings on the planet.”
He had also been preparing for a large event titled “Swachha Belagavi,” reportedly aimed at mobilising nearly 25,000 people. However, district authorities had already started taking a strict approach regarding permissions, banners, and related public activities.
Investigation Under KPID Act
The investigation has been initiated under the Karnataka Protection of Interest of Depositors (KPID) Act, which allows authorities to probe financial establishments suspected of cheating depositors.
Officials now have powers to:
- Examine bank accounts and financial records
- Seize documents and electronic evidence
- Inspect movable and immovable assets
- Freeze accounts or attach assets if required
Senior police officers and a CRPF platoon were deployed during the raid due to the large public attention surrounding the case.
Assistant Commissioner Shravan Nayak said officials are continuing to examine documents and question Neelannavar regarding multiple financial transactions.
Authorities are expected to take further legal action based on the findings of the ongoing investigation.