Mancherial Inspector R Bansilal said Siripuram Srinivas from the town, and the owner of Sainath Residency, Thipparaveni Akhil of Bellampalli, and Medipatla Arjun, from Tikanpalli in Hajipur mandal, were apprehended for organising prostitution.
They were caught committing the offence when police raided the lodge following a tipoff.
On being interrogated, Srinivas confessed to committing the offence for long to earn a fast buck.
He said he used to target youngsters from different parts of the district and force women into flesh trade by luring them with huge sums of money.
A case has been registered and an investigation taken up.