Arrest Made After Thousands Duped in Tissue Paper Ponzi Scheme
JUNE 05, 2015
Jakarta. Police have arrested a man accused of duping thousands of people across the country in a Ponzi scheme involving a fraudulent tissue paper business.
Jakarta Police spokesman Sr. Comr. Muhammad Iqbal said the lone suspect in the case, Kamal Tarachand, was arrested on Wednesday at a hotel in Sunter, North Jakarta and was charged with fraud.
“Investigators are now developing the case to see if there are more suspects,” Iqbal said.
Kamal, the officer said, tricked unsuspecting victims by promising between Rp 50,000 and Rp 200,000 ($3.7-$15) per day in return for every Rp 1 million invested in the company.
“Some immediately transferred Rp 10 million, others Rp 300 million and some Rp 500 million. A lot of the victims are also celebrities,” Iqbal said.
“Investigators have questioned several victims as well as the primary suspect. The victims are not only from Jakarta but also major provinces like Central Java, East Java and South Sumatra.”
To convince his victims, Kamal said his company was making money selling advertising space on the back of the tissue paper packets his company produces. Kamal also provided samples of his products, which include advertisements like restaurants to cosmetics.
Kamal hired Nana Khairina, a soap opera actress, to act as a spokeswoman for the company.
Kamal “claimed to be the nephew of Raam Punjabi, which is why I believed him,” Nana said at the Jakarta Police headquarters on Wednesday as quoted by Detik.com.
“I was told to promote the tissue paper in return for tens of millions of rupiah a month."
Rizal Jibran, also an actor, said he was promised a total of Rp 22 billion for a 1,000-day contact.
“But so far [Kamal] has only paid me Rp 5 million,” Rizal said.
The scheme unraveled after the actors and two dozen victims reported Kamal to the Jakarta Police on Wednesday.
Herdian Saksono, the lawyer for the victims, said some were also told that as members they would get free advertisements on top of the daily commission.
“But the tissue never even went into production,” he said.
Some victims, the lawyer continued, invested as far back as 2013 and in the two years Kamal was running his Ponzi scheme, the suspect attracted thousands of investors.
Novita Sari, 52, said she even had to sell her house in East Jakarta to enter the fraudulent investment scheme.
“I sold my house for Rp 750 million. Some was used to buy a car and I used the rest, Rp 471 million to join this tissue business,” she said as quoted by Tribunnews.com.
Police on Friday raided Kamal’s office in Kelapa Gading, North Jakarta, police spokesman Iqbal said.
Kamal has been charged with embezzlement, but police are considering more charges.
“We are considering money laundering [charges]. We are investigating how much money [was embezzled] and where it went,” Iqbal said.
Adj. Sr. Comr. Arie Ardian, chief of the Jakarta Police’s economics crimes unit, said police had confiscated several of Kamal’s assets.