How 5 Indian Americans laundered $30m in Cash-for-Bitcoin scam in New York - Hindustan Times
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How 5 Indian Americans allegedly laundered $30m in Cash-for-Bitcoin scam in New York

Oct 25, 2023 03:58 PM IST

Five Indian Americans face investigation for $30 million crypto exchange scheme in New York

Five Indian Americans are reportedly being investigated for an illegal $30million crypto exchange scheme operating in the heart of New York. An investigative report by 404 Media and Court Watch has revealed how all rules were broken in the multi million dollar Cash-for-Bitcoin fraud.

A cryptocurrency ATM in Hong Kong, China, on Tuesday, Oct. 24, 2023. Photographer: Lam Yik/Bloomberg(Bloomberg)
A cryptocurrency ATM in Hong Kong, China, on Tuesday, Oct. 24, 2023. Photographer: Lam Yik/Bloomberg(Bloomberg)

The detailed investigation has exposed a criminal syndicate where digital currencies like Bitcoin were being laundered into cash, despite presence of legal online exchanges such as Coinbase. The Court records have documented a scene where men rendezvous on street corners with bags brimming with cash.

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5 Indian Americans, Shaileshkumar Goyani, Brijeshkumar Patel (aka Samir), Hirenkumar Patel, Naineshkumar Patel, Nileshkumar Patel, and Raju Patel (aka Jay) have been accused of running this illegal Bitcoin exchange with an adept criminal finesse, bypassing the legal scrutiny.

The operation was unraveled in April 2021 when the FBI stumbled upon a vendor on dark web marketplaces offering to exchange Bitcoin for cash via the U.S. Postal Service. The journey led to the arrest of an individual in February who acted as a conduit, mailing packages of cash from a post office in Westchester County, New York, on behalf of the gang.

The report claims, this individual morphed into a confidential source for the FBI, shedding light on a meticulous operation where cash and Bitcoin exchanged hands at prearranged rendezvous points. The operation saw around $100,000 to $300,000 being exchanged about three times a week, with the serial numbers of specific banknotes acting as tokens of authenticity between the parties involved.

Undercover FBI agent partook in about 80 controlled cash pickups from February to September, making a whopping $15,067,000 transaction and leading to a ripple effect that saw multiple individuals linked to this underground Bitcoin exchange identified.

The investigation unearthed how the defendants allegedly made frequent trips across state lines, with cash often marked indicating their regional bank origins. The operation's tentacles spread across various states including New Jersey, Massachusetts, Georgia, Pennsylvania, and South Carolina.

Unearthed from the court records, images capture snippets of this covert operation, where surveillance footage shows men with large bags – bags laden with cash ready to be converted into Bitcoin, a digital haven for the criminal underworld. The case is currently under prosecution by the Southern District of New York.

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