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Indian Authorities Crack $5.4 Million Crypto Scam, Arrest 11

Security

decrypt.co 21 February 2022 13:17, UTC
  
Reading time: ~2 m

Indian authorities have arrested 11 people in connection with a crypto scam that allegedly duped would-be investors out of $5.36 million (₹400 million).

According to the Times of India, Nagpur police conducted a dramatic commando raid in Lonavala, arresting four individuals and seizing gold, "high-end vehicles" worth roughly $134,000 (₹10 million), a laptop, $25,000 in cash, eight cellphones, and a firearm with seven live cartridges.

The four arrested were identified as Nishid Wasnik, his wife Pragati, Gajanan Mungune, and Sandesh Lanjewar.

A day later, another seven individuals were arrested in connection with the case, according to local media. All those arrested have been charged under the IPC, Maharashtra Protection of Interest of Depositors Act and Information Technology Act provisions.

Wasnik, his wife, Mungune, and Lanjewar had reportedly been on the run for a year, and are accused of duping investors in a scam reaching back to 2017. The scam allegedly involved inducing would-be investors to buy Ethereum from the website ZebPay and then send them to Wasnik's website, Ether Trade Asia.

"On the website, the gang projected a notional benefit to each investor, but siphoned off their Ethers to benefit Wasnik and his aides," said Commissioner of Police Amitesh Kumar. "Wasnik and his gang seemed to have transferred huge numbers of Ethers to some other site or monetized them to support his lavish lifestyle."

In all, police have identified over 170 investors who lost just under $500,000 (₹37,000,000), but are investigating "dubious transactions" in digital currencies worth around $5.4 million.

The gang is also accused of having kidnapped and shot an associate, Madhav Pawar, last year. According to the Times of India, Pawar was killed for failing to share a "password of crucial transactions."

After going into hiding, the gang was tracked down through their online activities.

India and crypto

News of the arrests comes as India's government and central bank wrestle over the question of cryptocurrency's legality.

While the country's finance minister Nirmala Sitharaman has announced a 30% tax on crypto income with no exemptions or deductions, the governor of the Reserve Bank of India, Shaktikanta Das, has maintained a hardline stance on crypto.

Earlier this month, Das described private cryptocurrency as “a big threat to our macroeconomic stability and financial stability.”

Despite the regulatory uncertainty, crypto investments in India grew from $923 million in 2020 to nearly $6.6 billion in 2021—providing fertile ground for crypto scammers.


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