ED raid at Shivam Associates owner's Belagavi premises enters second day
Synopsis
The ED's two-day raid on Shivam Associates owner Shivanand Neelannavar's Belagavi premises lays bare the scale of an alleged ₹2,400 crore fraud that reportedly duped over 40,700 investors. With CRPF cover and multi-city ED teams on the ground, investigators are now chasing the money trail — including ₹540 crore reportedly pushed into the stock market at a loss of ₹170 crore.
Key Takeaways
The ED conducted a second consecutive day of searches on 8 August at M.S.
Tower, Shivabasavanagar, Belagavi , linked to Shivam Associates owner Shivanand Neelannavar .
The alleged fraud involves collection of around ₹2,400 crore from more than 40,700 investors across Karnataka.
Approximately ₹540 crore of investor funds was reportedly invested in the stock market, resulting in an estimated loss of ₹170 crore .
The ED has registered an FIR under money-laundering provisions; earlier searches covered three locations in Belagavi district including premises of business partner Subhash Nandaragi in Chikkodi .
Neelannavar was arrested after a 15 May raid by district authorities and is currently out on bail; the CID is separately handling the criminal investigation.
The Enforcement Directorate (ED) pressed ahead with its search operation for a second consecutive day on Saturday, 8 August at premises linked to Shivanand Neelannavar, the owner of Shivam Associates, in connection with an alleged multi-crore financial fraud that reportedly ensnared more than 40,000 investors across Karnataka.
Where the Search Stands
ED officials continued inspecting the M.S. Tower premises located in Shivabasavanagar, Belagavi city, in North Karnataka. The operation is being conducted under CRPF security cover, with ED teams drawn from the Goa and Mangaluru zones participating. Document verification and examination that began on Friday continued into Saturday as officials scrutinised materials recovered during the searches.
The Scope of the Alleged Fraud
According to the CID investigation, Shivam Associates allegedly collected around ₹2,400 crore from more than 40,700 people, promising lucrative returns on deposits. Of this sum, approximately ₹540 crore was reportedly channelled into the stock market, resulting in an estimated loss of ₹170 crore. The scale of the alleged scheme sent shockwaves across Karnataka when it first came to light.
Key Developments in the Case
On 15 May, the district administration and police conducted the first raid on the company following allegations of illegal deposit collection. A case was registered and Neelannavar was subsequently arrested. The investigation was later transferred to the CID. Neelannavar, who is currently out on bail, was not present at his residence when the ED team arrived; his wife and brother were brought to the premises for the inspection.
The ED has registered an FIR in connection with alleged illegal money transfers linked to the case. Earlier, the agency conducted simultaneous searches at three locations in Belagavi district — M.S. Tower Apartment in Shivabasavanagar, Neelannavar's residence in Badakundri village, and the residence of his business partner Subhash Nandaragi in Chikkodi.
What the ED Is Focusing On
With the CID already handling the criminal investigation, the ED's mandate is to trace the money trail — mapping transactions linked to funds collected from investors and identifying any proceeds of crime under the Prevention of Money Laundering Act (PMLA). The two-day duration of the search, combined with multi-city ED teams and CRPF cover, signals the agency considers the financial network to be complex and potentially wide-ranging.
As the probe deepens, investigators are expected to examine the full chain of fund flows, including the stock market investments and any offshore or shell-company linkages, before deciding on further action against those named in the case.
Point of View
Intermediaries, or shell entities. What is striking is that Neelannavar remains on bail despite the scale of the alleged scheme — a detail that will draw scrutiny as the ED builds its PMLA case. Karnataka has seen a string of chit-fund and investment-scheme collapses in recent years; each time, the gap between arrest and asset attachment has allowed funds to move. The real test here is whether the ED can freeze and recover assets before they dissipate further.
NationPress
8 Aug 2026
Frequently Asked Questions
What is the Shivam Associates fraud case in Karnataka?
Shivam Associates, owned by Shivanand Neelannavar, allegedly collected around ₹2,400 crore from more than 40,700 investors by promising high returns on deposits. The scheme came to light after a district administration raid on 15 May, following which Neelannavar was arrested. He is currently out on bail.
Why is the ED investigating Shivam Associates?
The Enforcement Directorate has registered an FIR under money-laundering provisions to trace illegal fund transfers linked to the alleged fraud. The agency is focusing on the money trail and transactions connected to investor funds, including approximately ₹540 crore reportedly invested in the stock market.
Where did the ED conduct its searches?
The ED searched three locations in Belagavi district: M.S. Tower Apartment in Shivabasavanagar, Neelannavar's residence in Badakundri village, and the residence of his business partner Subhash Nandaragi in Chikkodi. The M.S. Tower search entered its second day on 8 August.
How much money did investors allegedly lose?
According to the CID investigation, around ₹540 crore of the funds collected was reportedly invested in the stock market, resulting in an estimated loss of ₹170 crore. The total amount allegedly collected from investors stands at around ₹2,400 crore.
What happens next in the Shivam Associates case?
With the ED now involved, investigators are expected to map the full chain of fund flows and identify any proceeds of crime before deciding on further legal action. The CID continues its parallel criminal investigation, and the ED's findings could lead to asset attachment proceedings under PMLA.
