GainBitcoin crypto scam: The Directorate of Enforcement (ED) apprehended a man named Nitin Gaur on Friday in relation to a cryptocurrency case involving M/s Variable Tech Pte Ltd, pegged at Rs 6,606 crore, tied to the GainBitcoin Ponzi scheme. Gaur was arrested under the Prevention of Money Laundering Act (PMLA).

The ED's action stems from multiple FIRs filed by both Maharashtra and Delhi Police against the aforementioned company, its deceased founder Amit Bhardwaj, and associated family members including Ajay Bhardwaj, Vivek Bhardwaj, Simpy Bhardwaj, and Mahender Bhardwaj, as well as various multi-level marketing (MLM) agents.

False promises 

Investors were allegedly misled with promises of substantial monthly returns of 10 per cent in Bitcoin, amounting to Rs 6,606 crore as of 2017, under the guise of Bitcoin mining ventures. However, the accused are purported to have deceived investors and concealed the acquired Bitcoins in unidentified online wallets.

Investigators identified that Nitin Gaur received illicit proceeds in his Binance cryptocurrency account from a wallet operated by Ajay Bhardwaj. The ED's inquiry disclosed that Gaur aided Ajay Bhardwaj in obscuring and stratifying these unlawfully obtained funds.

Following a search at Gaur's residence on December 29, he was arrested and subsequently transported to Mumbai for judicial procedures on December 30. The PMLA Special Judge in Mumbai has granted the ED custody of Gaur for further interrogation until January 6, 2024.

ED investigates Hawala links

Additionally, the ED raided locations associated with suspected Hawala operators linked to the GainBitcoin scheme's promoters. These operations uncovered crypto traders potentially engaging in money laundering by converting various cryptocurrencies, including Bitcoin, Ethereum, USDT, and Tron, into Indian Rupees without adequate financial documentation. Such traders are summoned by the ED for scrutiny.

The investigation has indicated that the accused promoters possess expertise in crypto-asset transactions, employing counterfeit KYC documents, VPNs, and intricate methods like mixing, swapping, and peer-to-peer exchanges to obfuscate their illegal gains.

During the raids, authorities seized Rs 16.7 lakh in cash and multiple digital devices. Ajay Bhardwaj and Mahender Bhardwaj, principal suspects, remain fugitives, whereas Simpy Bhardwaj, arrested earlier by the ED on December 17, is presently in judicial custody. The ED has provisionally attached assets valued at Rs 69 crore and is pursuing international collaboration for further action. Investigations continue.