India’s ED works with FBI to uncover $360m drug trafficking operation using crypto

As an analyst with a background in financial crime and regulatory compliance, I am deeply concerned about the growing trend of illicit activities involving cryptocurrencies in India. The recent collaboration between the Enforcement Directorate (ED) and the Federal Bureau of Investigation (FBI) to crack down on a $360 million drug trafficking operation is a stark reminder of the risks associated with the use of digital currencies for criminal activities.

I’ve discovered that India’s Enforcement Directorate (ED) has joined forces with their American counterparts in order to dismantle an extensive drug trafficking network valued at approximately INR 3000 crore or $360 million. This operation reportedly involves the use of cryptocurrencies.

As a crypto investor, I’ve been keeping an eye on recent developments in the world of digital currencies. Last week, some intriguing news emerged from local reports. The Enforcement Directorate (ED) collaborated with the Federal Bureau of Investigation (FBI) to apprehend two individuals allegedly implicated in a crypto-related operation. This investigation was instigated in the year 2023, but the arrests were made only recently. I was particularly interested because the FBI passed on valuable intelligence to the ED that led to these arrests.

On April 27, Parvinder Singh and Banmeet Singh, two residents of Haldwani in Uttarakhand, were taken into custody during police searches carried out in the area.

The suspect is reportedly believed to have managed their criminal enterprise through hidden marketplaces on the dark web, such as Silk Road 1, AlphaBay, and Hansa. Additionally, they employed online advertisements to attract buyers for the illegal sale of drugs. They also developed a network of distributors and organized distribution cells, while processing payments using multiple cryptocurrencies.

The funds were then laundered via multiple cryptocurrency wallets. 

The FBI has already retrieved approximately $180 million in digital currencies that are connected to the ongoing case. Simultaneously, the ED has seized significant documents pertaining to this operation.

In April, the Enforcement Directorate (ED) discovered that Raj Kundra, a well-known businessman married to Bollywood actress Shilpa Shetty, was under investigation for an illicit cryptocurrency operation worth approximately $800 million, as reported on April 19th. This isn’t the sole instance of such an operation connected to cryptocurrencies that the ED has uncovered in April.

As a researcher studying investment schemes, I came across one called “Gain Bitcoin,” initiated in 2017. It enticed investors with an alluring proposition: a monthly return of 10%, conveniently paid out in the form of Bitcoin.

As an analyst, I’ve noticed a concerning trend of increasing illegal activities involving cryptocurrencies within our country. In the month of March 2024, the Enforcement Directorate (ED) took legal action against 299 entities for their involvement in such misconduct. These actions were initiated following the exposure of fraudulent crypto-mining schemes.

Regulators in India have sent out compliance notices as a precautionary measure to various cryptocurrency exchanges within their jurisdiction, requiring them to adhere to the Prevention of Money Laundering Act (PMLA) regulations.

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2024-04-30 13:30