India’s financial watchdogs seize over $30m in crackdown on crypto fraud

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As a researcher who has been following the developments in India’s crypto space closely, I am deeply concerned about the recent revelations of major crypto scams that have duped innocent investors out of their hard-earned money. The latest crackdown by the Enforcement Directorate (ED) on the “E-Nugget” scam and the fake cryptocurrency mining scam operated by Shigoo Technology Private Limited and Lillian Technocab Private Limited, is a clear indication that such fraudulent activities are rampant in this space.

As a researcher, I’d put it this way: The Enforcement Directorate (ED) of India has uncovered and taken action against two significant cryptocurrency scams within the country. These fraudulent schemes lured investors with enticing promises of substantial returns.

The Enforcement Directorate (ED) has successfully confiscated approximately INR 90 crores (or $10.7 million) in cryptocurrencies during their investigations against the ‘E-Nugget’ scam, significantly crippling the illicit activities associated with it.

ED, based in Kolkata, effectively dismantled the notorious “online gambling app fraud” named “E-Nugget.” Deceptively marketed as a gaming site, E-Nugget lured users with enticing promises of substantial returns on their investments. The seized crypto assets belonging to ED have been transferred to:

— ED (@dir_ed) April 30, 2024

Aamir Khan and Romen Agarwal, two individuals involved, have been taken into custody and faced charges for their role in the ongoing investigation.

Based on a report filed with the Park Street Police Station in Kolkata, this scheme functioned under the guise of a gaming platform, providing substantial profits for those who invested. Regrettably, following investments being made, users found themselves unable to recover their initial funds as the app inexplicably went offline.

Previously, an investigation by the Enforcement Directorate uncovered that approximately 2,500 bogus bank accounts were employed by scammers to carry out their fraudulent activities. A segment of the ill-gotten gains was subsequently channeled into investments in cryptocurrencies.

As a crypto investor, I’ve been closely monitoring my accounts on Binance, ZebPay, and WazirX. Recently, disturbing news emerged that approximately ₹ 90 crore worth of funds in around 70 accounts connected to these exchanges were frozen based on information gathered by the Enforcement Directorate (ED). These accounts are under investigation for their involvement in a scam.

The Enforcement Directorate (ED) has confiscated a total value of INR 163 crores (around $19 million) in assets under its control. This includes cash, cryptocurrencies, balances in bank accounts, and certain offices.

As a researcher, I’ve come across some intriguing developments regarding a fake cryptocurrency mining scam that has been under investigation by the Central Bureau of Investigation (CBI) in India. The CBI has taken measures to conduct a thorough nationwide search in relation to this case. Specifically, they have registered a complaint against two companies, Shigoo Technology Private Limited and Lillian Technocab Private Limited, based on their involvement with the HPZ token app. This action was taken under the purview of India’s Information Technology Act, 2000.

The app deceitfully presented itself as a legitimate cryptocurrency mining venture, enticing investors with supposed mining equipment rental prospects for Bitcoin and other digital currencies.

Approximately 150 bank accounts were employed to amass investments from unsuspecting individuals. This financial scheme bore resemblance to typical Ponzi structures, where the defendant transferred funds obtained from one investor towards luring in fresh participants, thereby fostering confidence.

The illicit funds were then moved out of India using cryptocurrencies.

Previously, the Enforcement Directorate confiscated assets linked to this scandal valued at around INR 176.67 crores or approximately $21 million.

The country’s efforts to regulate the use of cryptocurrencies include the intensified enforcement actions. The Financial Intelligence Unit (FIU) in the country has voiced worries over the possibility of misappropriating cryptocurrency exchanges for money laundering activities. Consequently, providers of cryptocurrency-related services within the nation must register with FIU-India and adhere to the Prevention of Money Laundering Act (PMLA), 2002.

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2024-05-01 13:46