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<\/figure>\n\n\n\nRaids Conducted Across Six Cities<\/strong><\/p>\n\n\n\n On October 16, 2026, the ED\u2019s Mumbai Zonal Office-I conducted searches at 29 premises across Mumbai, Nashik, Ahmedabad, Gandhinagar, Surat and Bhavnagar. The operation was carried out under the Prevention of Money Laundering Act, 2002.<\/p>\n\n\n\n Investigators searched company offices, the residences of promoters and certain share allottees, stockbroking and finance firms, and premises linked to suspected operators of promotional WhatsApp groups. Documents, digital devices, share transaction records and property-related papers were also seized.<\/p>\n\n\n\n The agency\u2019s investigation is ongoing, and the freezing of accounts is an investigative measure rather than a final determination of guilt.<\/p>\n\n\n\n How the Alleged Pump-and-Dump Scheme Worked<\/strong><\/p>\n\n\n\n According to the ED, the suspected operation began with preferential allotments of shares and convertible warrants to a selected group of individuals and entities between April 2023 and March 2024.<\/p>\n\n\n\n The agency alleges that a substantial portion of the funding came from a relatively small network of connected individuals, firms and lenders. Investigators are examining whether these allotments helped establish holdings that could later be sold to retail investors after promotional activity increased demand.<\/p>\n\n\n\n Between late December 2025 and February 2026, WhatsApp groups using names such as \u201cMultibagger Stocks\u201d allegedly circulated daily buy recommendations for the two companies. The campaign reportedly also used X, SMS and other communication channels.<\/p>\n\n\n\n The ED suspects that the resulting buying interest pushed up share prices and trading volumes, allowing some preferential allottees to sell portions of their holdings to new investors.<\/p>\n\n\n\n What Is a Pump-and-Dump Scam?<\/strong><\/p>\n\n\n\n A pump-and-dump scheme involves artificially generating enthusiasm for a stock to increase its price. Those who accumulated shares earlier can then sell them into the heightened demand. When promotional interest fades and selling pressure increases, investors who purchased at inflated prices may suffer substantial losses.<\/p>\n\n\n\n WhatsApp groups promising multibagger returns can make such schemes particularly persuasive because recommendations appear to come from communities of fellow investors. However, a large number of messages or enthusiastic participants does not establish that a stock is fundamentally sound.<\/p>\n\n\n\n The ED has not quantified the total investor losses in this particular case.<\/p>\n\n\n\n