What seems to be uncovering as a potential ponzi scam, Ringing Bells the so-called makers of world’s cheapest android smartphone Freedom 251 is under Enforcement Directorate (ED) investigation.
According to various news agencies, ED has been questioning the Ringing Bells CEO Mohit Goel for hours under the Foreign Exchange Management Act (FEMA) and the agency doubts of another Ponzi scam.
“Ringing Bells certainly misled people by quoting a price as low as Rs 251. Mohit Goel appears to be a publicity-hungry person who thought that if he comes out with an unusual scheme, he will catch the eyeballs of the people as well of media”. a senior official at Enforcement Directorate told The Quint.
Ringing Bells reportedly collected around 2.41 crores from users under two different accounts from two different payment gateway providers – CCAvenue and PayU. While PayU has assured its users and ED that it will return the money, CCAvenue is yet to respond.
To our luck, all the money is under an escrow account which is meant for safeguarding customer’s money. ED has written to CCAveneue asking not to release the money to Ringing Bells, but to refund all the money back to customers.
“It appears that they planned to produce fake receipts to CCAvenue showing delivery of phones to withdraw money from the escrow account,” according to a statement from a senior official at Enforcement Directorate.
Doubts on Ringing Bells – Freedom 251
- An android smartphone for Rs 251 (when the actual cost of the smartphone will be way more than Rs 2,500). Even the company claimed to make Rs 31 profit from every handset sold.
- No owned manufacturing plants and no known manufacturing partners.
- Two Escrow accounts to collect money – One with CCAvenue for the ‘Freedom 251’ handsets and another with PayU for other mobiles costing Rs 4000 and above
- Planned to produce fake receipts to CCAvenue to withdraw the money.
- Claims project under the Government’s Make in India initiative – but it was uncovered that Freedom 251 is not under Make in India initiative.
Still, Goel in his testimony with ED had stated that he would continue with his ‘Freedom 251’ project. But the agency is keeping a close watch of all its operation.