Mastermind behind ₹49,000 cr PACL scam arrested in Punjab: Here's how land-for-investment racket duped 5 cr Indians

In a major breakthrough in one of India’s biggest financial frauds, the Economic Offences Wing (EOW) of Uttar Pradesh has arrested 69-year-old Gurnam Singh, director of Pearls Agro-Tech Corporation Limited (PACL), from Punjab’s Ropar district. Singh is believed to be the key architect of a ₹49,000 crore Ponzi scheme that cheated more than five crore investors across ten Indian states.

The arrest marks a major development in the multi-agency investigation into PACL, which had been under scrutiny by the Central Bureau of Investigation (CBI), the Enforcement Directorate (ED), and market regulator SEBI. Singh is one of ten accused in the case, four of whom are already in custody in related cases filed by the CBI.

How the PACL scam was orchestrated: Land-for-investment racket

The scam operated under the guise of offering land plots in return for fixed or recurring deposits. Despite not being licensed as a Non-Banking Financial Company (NBFC), PACL aggressively collected funds from unsuspecting investors in blatant violation of the Reserve Bank of India Act.

In Uttar Pradesh alone, the company is estimated to have amassed over ₹19,000 crore. Investors were issued bond receipts promising land allocations, but the plots never materialised. Many were left with nothing to show for their investments.

EOW Director General Neera Rawat called the scheme a classic example of a Ponzi operation, where returns were paid to early investors using funds from newer ones. A vast network of agents, incentivised by hefty commissions, helped spread the scheme across urban and rural pockets, frequently convincing friends and family to join.

Parallel investigations by the ED have uncovered a complex web of shell companies used to launder investor funds. One such entity, MDB Housing, was reportedly used to route PACL money from Uttar Pradesh and other states. The ED has identified Harsatinder Pal Singh Hayer, son-in-law of PACL founder Nirmal Singh Bhangoo, as the controller of MDB Housing. Hayer is currently in judicial custody.

According to ED officials, funds were layered through several accounts and disguised as real estate investments. The agency has filed a supplementary prosecution complaint to tighten its case against the key players, including Singh.

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Background and ongoing action

The scam first came to national attention following widespread complaints and an investigation initiated by SEBI. A formal case (No. 1/18) was registered at the EOW police station in Kanpur under multiple sections of the Bharatiya Nyaya Sanhita (BNS).