Cryptocurrency scam: Pune police net architect of crypto-con Amit Bharadwaj
According to commissioner of police Rashmi Shukla, Bhardwaj had set up a multi-level marketing company and is accused of cheating investors to hand him bitcoins in the promise of higher returns.Updated: Apr 05, 2018 23:27 IST
The Economic Offences Wing (EOW) and Cyber Cell of the Pune police have arrested the alleged cryptocurrency mastermind and director of firm Gain Bitcoin, Amit Bhardwaj, in connection with a multi-crore cryptocurrency scam. Bharadwaj was arrested by the Pune police from the Delhi airport after he returned to the national capital from another country.
Bhardwaj’s arrest has come a day after the EOW arrested seven people in connection with the cryptocurrency scam. According to commissioner of police Rashmi Shukla, Bhardwaj had set up a multi-level marketing company and is accused of cheating investors to hand him bitcoins in the promise of higher returns. Under his scheme, investors were lured to invest one bitcoin for a ten per cent return on their investments, said crime branch officials. The contract would be valid for eighteen months. Three cases of bitcoin MLM have been registered in Pune, two at Nigdi and one at the Dattawadi police station.
Bhardwaj has written e -books on ‘Blockchain’ and ‘Cryptocurrency’ and ran a website GBMiners pool (www.gbminers.com) claiming that it was the first Bitcoin Mining Pool from India and biggest from outside China. GBMiners is a product of Amaze Mining and Blockchain Research Ltd, the portal stated.
“It is one of the major scams with inter-state ramifications. We have taken help of cyber crime experts. Their expertise and technical know-how is being used to unearth the scam. Amit targeted housewives, individuals, educated people and professionals by promising them more than 200 per cent returns through cryptocurrency,” said Shukla.
Cyber crime expert Praneet Kumar and global Blockchain foundation co-founder, which is assisting the Pune cyber cell in investigating the scam, said, “Bhardwaj started defaulting early and online data regarding the transactions has been collected. It is impossible to give 200 per cent returns on a volatile currency like bitcoin. He made his own virtual currency known as MCAP of considerable lower value which is currently between ₹7-8. The investors had invested in dollars and were cheated by non-delivery of bitcoins by him,” he said.
In the case lodged at the Nigdi police station, Bhimsen Baburam Aggarwal, a resident of Pradhikaran, named six suspects including Amit Bhardwaj and Ajay Bhardwaj, both directors of Gain Bitcoin. Aggarwal had invested ₹1 crore in Gain Bitcoin for 93.5 bitcoins and was duped.
Explaining his modus operandi, Shukla said that arrested motivational speaker Pankaj Adlakha, who was arrested from Delhi, conducted a number of seminars where he influenced people from Pune, Delhi and other cities including Dubai, to invest in bitcoins being offered by Bhardwaj. Instead of returning the promised bitcoins, Bhardwaj cheated them by giving his own MCAP currency of very low value and cheated thousands of investors.
Cyber cell officials said that so far 25 people have come forward and complained regarding the bitcoin-related scam and the amount is around ₹2.25 crore till date. The police have seized 32 bitcoins, 79.99 other virtual currency and ₹38.96 lakh cash in connection with the scam.
Preliminary investigation details revealed by commissioner Shukhla stated that 160 bitcoins, three lakh MCAP currency will be seized soon. Three special teams have been constituted under the Special Investigation Team (SIT) by the Pune police.