Mysuru: A businessman and a politician from Mysuru has been arrested along with two others by the Bengaluru Central Crime Branch (CCB) sleuths for circulating fake notes worth Rs. 50 lakh in the name of purchasing gold from jewellers. The CCB personnel arrested the politician yesterday evening near Bharat Cancer Hospital and later picked up two of his associates.

According to Police sources, the politician from Hebbal was into real estate business and had contacts with fake note racketeers. The name of the accused, however, has not yet been revealed by the Police as it will hamper investigation.

As real estate business is facing a slump after demonetisation, the politician came up with the idea of purchasing gold from merchants and in turn giving them fake notes, the Police said.

His modus operandi was to convince gold merchants that he needed gold urgently for his friend’s marriage and he would settle the deal by offering “extra cash” and that too in one-time settlement. While paying money for the purchased gold, the accused used to pack the currency note bundles in such a way that a couple of currency notes on the top of each bundle would be genuine and the rest would be fake.

Rs. 30 lakh deal

Zeroing in on a gold merchant in Bengaluru, the accused purchased gold worth Rs. 30 lakh from him and gave cash – that mostly contained fake notes – to settle the deal. The unsuspecting merchant accepted the cash bundles that even had the seal of a bank. He then went to a bank to deposit the cash where he was told by the bank officials that the notes were fake. The merchant lodged a complaint with Halasuru Gate Police Station.

Police lay trap

As the case was of fake notes, the investigation was handed over to CCB. Probing the case, the CCB sleuths came to know that the accused was from Mysuru and decided to lay a trap. Accordingly, a Police team arrived in Mysuru yesterday and called up the accused and told him that they had gold and they needed cash immediately. The caller from the Police team convinced the politician that the gold was pure and they could not sell in the open market as there were a lot of restrictions.

Taking the bait, the accused agreed to purchase the gold for Rs. 20 lakh. The Policemen had called the accused to a secluded spot near Bharat Cancer Hospital, opposite a PU college at around 6.45 pm. The Policemen, dressed in plain-clothes, had taken a few pieces of metal that were painted gold to deceive the accused.

As the accused arrived at the spot, the Policemen asked for the cash and the accused asked for the gold and the CCB sleuths showed him a bag that contained gold-painted metal. The moment the unsuspecting accused fished out bundles of cash from his bag, the CCB sleuths caught hold of him and bundled him into their vehicle.

Based on the information provided by the accused, the CCB sleuths arrested two more persons. All the arrested have been taken to Bengaluru, Police sources said.