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CBI conducts nationwide searches in Bitcoin mining fraud

May 02, 2024 09:38 AM IST

CBI raids 30 locations in 10 states, including Mumbai, targeting two firms for duping investors with app-based Bitcoin mining scheme.

MUMBAI: The Central Bureau of Investigation (CBI) carried out searches across 30 locations in 10 states and union territories, including Mumbai as part of its crackdown against two private firms — Shigoo Technology Pvt Ltd and Lillian Technocab Pvt Ltd and their directors — for allegedly duping investors via an app-based fraudulent scheme.

Chhattisgarh deputy chief minister Vijay Sharma in February 2024 had announced that the state government would recommend a CBI probe into the murder of Bhuneshwar Sahu. (Representative Image)

The frauds allegedly entrapped victims into investing through the HPZ Token App in a purported Bitcoin mining scheme, promising astronomical returns, agency sources said.

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The CBI had booked the firms and their directors under sections 120B (criminal conspiracy), 419 (cheating by personation) 420 (cheating) and relevant sections of the Information Technology Act, agency sources said.

Bitcoin is a convertible virtual currency, but not a legal tender in India, and its mining refers to the method used by Bitcoin and other cryptocurrencies to produce new coins and to examine new transactions.

The agency’s searches have resulted in the seizure of a range of digital evidence, including mobile phones, computer hard drives, SIM cards, ATM/ debit cards, email accounts and documents, the sources added.

The CBI investigation has revealed the existence of around 150 bank accounts that the accused had allegedly used to collect funds from investors. The accused allegedly utilised the funds for payouts to the previously duped investors to build trust and attract more investors. “The collected investment was either converted into cryptocurrency or diverted abroad illegally via hawala channels,” a CBI source said.

The fraudulent scheme involved misleading the public into investing in allegedly non-existent crypto-currency mining machine rentals, the sources said. “Searches conducted in the case is a critical step in the ongoing investigation to dismantle the fraudulent scheme and gather evidence against the accused,” a CBI source said.

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