India’s biggest cryptocurrency scam continues to rattle chains, leading two more to cell blocks. The two detainees were close aides to the mastermind behind GainBitcoin scam, Amit K. Bhardwaj, reported a local media outlet, The Times of India.
Indian Bitcoin entrepreneurs and alleged notorious scammers Amit Bhardwaj and his brother, Vivek Bharadwaj, were arrested on April 4, accused of scamming $300 million from about 8,000 investors.
Amit Bhardwaj, along with the scamming business of course, was the Founder/CEO of GB Miners and Amaze Mining and Research Limited. He also published three ‘hot’ ebooks on cryptocurrency which were promoted by bollywood celebrities — classic example of our influenced buying habits.
The arrests were made on complaints about reported fraud by GainBitcoin out of which the name Parvendra Singh, who is a businessman from Nanded, stands out as he was the first one to lodge a complaint under Prevention of Money Laundering Act (PMLA) in Mumbai.
Along with Prevention of Money Laundering Act (PMLA) the accused were detained for cheating sections of Information Technology Act, Prize Chits Fund and Money Circulation schemes (Banning) Act, and relevant sections of the Maharashtra Protection of Investors Deposit (MPID) Act.
A guaranteed return of 10% was assured to the investors every month (totally 180 pc returns per annum) for a continuous period of 18 months in bitcoins for the purpose of mining bitcoins on the cloud.
The gang claimed to have massive cloud mining setup in China, Hong Kong and Singapore. From January 2017 till date, investment of around 147.4 bitcoin on the website “www.gainbitcoin.com” was made, for which the total return promised to the complainants was around 300 bitcoins.
After the delivery was made and the bitcoin was transferred safely into the scammer’s wallet, instead of the promised returns, the investors usually got unattended phone calls and silence. The accused fled the place but couldn’t make it out of New Delhi where he was caught trying to make it to Bangkok.
The victims were asked to invest one bitcoin for which they would get a 1% return. But the company never gave them the returns; instead they fled from the place
— Police Official
Action was taken jointly by the Reserve Bank of India (RBI), the Enforcement Directorate (ED) and the Cybercrime Cell of Pune Police.
Following the trail, two more from the scammer ring have been caught under the offense of aiding and abetting. According to a police officer:
The duo were involved in marketing the scheme. They had lured hundreds of people and then disappeared. We are investigating the case and are also finding out on how many more people they have duped.
Forensic investigations revealed that the bitcoin scam masterminds Amit Bharadwaj and Vivek Bharadwaj were in possession of 82,132 bitcoins and operated 84,617 user ids.
The Narendra Modi government and the country’s top court are yet to take a final call on the legality of cryptocurrencies in India. The Reserve Bank of India has made its displeasure with these virtual monies known when it announced that any entity regulated by them such as banks, wallets etc. shall not deal with or provide services to any individual or business entities for buying or selling of crypto currency, such as bitcoins.
India is reportedly looking into limited incorporation of cryptocurrency in public and private sector. With new gods come new devils, circling into an endless knot.