Hyderabad: A woman running an NGO and three of her associates have been arrested on the charges of cheating 2,700 people a total of Rs 8.1 crore after promising to build houses with the overseas subsidy for them in the neighbouring Yadadri Bhuvanagiri district.

K Krishnamma, Chairperson of Malyavi Karunodaya Society for people of Old age and Physically Handicapped, and the three others holding various posts in the society were arrested Saturday (May 26), a police release said.

Police recovered Rs 12.22 lakh cash and 'incriminating' material from their possession, it said.

The fraud came to light after a labourer of Tangutur village complained to the police.

According to the complaint, Krishnamma visited the village six months ago and assured that she would build double bedroom houses for poor people at the cost of Rs 7.5 lakh each with Rs 5 lakh as a subsidy to be arranged from NRI donors.

The buyers need to pay only Rs 2.5 lakh, she had said and collected Rs 30,000 as advance from several people in the village. However, even six months after obtaining the advance, the construction work was not started.

A case was registered based on the complaint, and during the investigation, it came to light the accused had collected a total of Rs.8.1 crore from 2,700 people from different villages in the district by making the same promise.

A hunt was on to arrest the absconding accused, police added.