Madhya Pradesh STF Busts Int'l Cryptocurrency Racket Worth Rs 50 Cr; Over 1,000 Investors Duped

Bhopal: A couple was arrested in Jabalpur on Tuesday on charges of running a cryptocurrency racket that allegedly duped over 1,000 investors from different countries of over Rs 50 crore.

An officer of the special task force (STF) said some members of the racket are on the run. The network had spread to several countries, including Malaysia, China, Singapore, Hong Kong and Thailand. The gang used to invest the swindled money in movies, casinos and properties in Bhopal, Jabalpur and overseas, police said.

Special DG (STF) Purushottam Sharma told reporters a special investigation team formed for the case arrested the prime accused, Brajesh Raikwar, his wife Seema and seized Rs 4 crore from their accounts.

The gang first established a website in India which imitated the Hong Kong stock exchange portal and based the server in Jaipur, Rajasthan. The matter came to light when a Bhopal-based citizen complained to police against a Hong Kong-based company engaged in buying and selling of cryptocurrencies. The man had heavily invested in the currencies, but was unable to re-sell them.

“Police came to know that Brajesh Raikwar, an engineering diploma holder, and Rupesh Rai, an air-conditioner mechanic, were the India promoters of the company, named Plus Gold Union Coin, and when their backgrounds seemed dubious, the case was handed over to the STF,” said Sharma.

Brajesh was arrested from Jabalpur when he came to the city from Dubai to meet his in-laws.

His interrogation revealed that Brajesh and Rupesh had formed a company along with Hong Kong resident Kevin. Together, they hatched a plan to dupe people online. After the business started making profits, they formed an IT company and got its software prepared from a Bangalore-based company.

Later, they started issuing silver, gold and platinum IDs and memberships, and got unsuspecting targets to invest in bitcoins, gold union coins and other cryptocurrencies promising double returns soon after. Their acquaintances and relatives in Malaysia and Australia also fell into the trap. A Malaysian citizen, Daniel Francis, is also reportedly involved in the racket.

Police said, that besides properties, the gang invested heavily in casinos in Mumbai and Goa and also spent large sums of money during trips to Australia, UAE, Malaysia, China, Thailand and Singapore.