Police in India have taken the suspected second in command of a complex cryptocurrency fraud scheme into custody.
They say Rohit Kumar has been charged with a variety of different crimes. He is alleged to have committed cheating, criminal conspiracy and a violation of the Prize Chits and Money Circulation Schemes (Banning) Act.
The charges come in relation to his suspected involvement in Money Trade Coin (MTC) – a coin which did not ever begin properly trading in an exchange context.
It is understood that the alleged fraud may have scammed investors out of a sum totalling five billion rupees, which is equivalent to around $70 million US dollars or £55 million British pounds.
According to police, Kumar and the group he allegedly worked with told potential investors that they would receive high returns upon investing in the scheme.
Kumar, who works as a collection agent, is believed to have evaded capture over his role in the alleged plot for a year.
The plot was complex and multinational in nature, with offices in Dubai and Delhi both believed to have played host to the alleged crimes.
While most of the conspirators are believed to be Indian, the advantage of having a presence in Dubai was that the law there is relatively friendly to cryptocurrency schemes.
While in Dubai, Kumar’s accomplice Lakhanpal supposedly held meetings with members of the Dubai royal family as part of the promotions for MTC.
He is even believed to have told people that his partner was a member of the royal family.
It is understood that when back in India, he claimed he was a representative of the Indian Ministry of Finance. He also told people that MTC had a number of offices in destinations around the world such as Italy and Singapore.
Three other individuals who are also alleged to have been involved in the scam have also been taken into custody. However, another has also been on the run: Amit Lakhanpal is understood to have travelled to London in the UK.
“The accused had set up office in Delhi’s Vikram Nagar and used to collect money from investors promising high returns. Lakhanpal was earlier holed up in Dubai and we believe that he may have fled to London”, a police source said.
This is far from the first time that India has suffered crypto-related crimes.
Just last month, it was revealed that 8,000 people had been tricked into parting with their cash as part of a scam in the city of Pune in the state of Maharashtra.
It is understood that this alleged scam, led by Amit Bhardwaj, was known as GainBitcoin. It is believed that the equivalent of millions of dollars were lost by investors as part of it.
The case demonstrated that Indian law enforcement authorities are increasing their understanding and use of technology in order to combat crypto fraud.
According to industry press, a “digital forensic analysis” was carried out in order to locate a wallet with 452 Bitcoins in it as well as cash, Ether coins and more.
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