The Directorate of Enforcement in India (ED) has attached $60 million worth of assets in connection with its probe against Amit Bhardwaj, in the alleged Bitcoin Ponzi fraud of $5.26 billion, according to CCN news portal.
Including six offices in Dubai, the Indian law enforcement agency has attached immovable properties of the owner of GainBitcoin.com, in addition to the residential apartments and bank balances of two of his associates; Hemant Bhope and Pankaj Adlakha, under the provision of Anti Money Laundering (AML) act.
Big Names Helped the Plan
It is reported, that this is the first attachment in the case where Bhardwaj- using the name of Variabletech Pvt Ltd, Singapore to trick people- got 8000 people to invest in his scamming Bitcoin trading Ponzi scheme.
The alleged conspirator Gainbitcoin. Com, held marketing events at pricy hotels across India, where his associates attracted attendees towards their Bitcoin mining investment schemes. It is mentioned, that in an event held in Noida city in 2016, the marketers claimed that GainBitcoin owns mining facilities in China.
To convince the attendees, they showed them video clips that used to belong to one of the Chinese mining facilities.
People who had no prior knowledge of Bitcoin, were tricked in methods like the one mentioned above. The digital currency’s potential as an investable asset would fuel investors’ interest, with most of them often mistaking GainBitcoin as the “Bitcoin company.” The thing that pushed an Indian parliamentarian to call Bitcoin as a Ponzi scheme while referring to GainBitcoin.
Under such ambiguous schemes, Bhardwaj and his partners embezzled around 8,000 Bitcoins. When the time to pay back investors arrived, Bhardwaj issued them a privately created, and worthless, cryptocurrency called MCAP, depending on sponsored stories he bought across the leading news channels in the Bitcoin industry, to fake a positive sentiment about his coin.
Large Number of Bitcoin Victims
In its turn, Ed stresses: “There are large numbers of investors who got cheated in this way,”.
Reports tell that scammers in India, with access to basic knowledge of Bitcoin, used to see digital currencies as a tool to rob people.
GainBitcoin triggered a climate of mistrust between the regulators and digital currency companies, which in their turn are still pursuing regulating blockchain and cryptocurrency in the country today.
News resources reported also that Bhardwaj associated himself with Bollywood celebrities, including Bipasha Basu, Shilpa Shetty, and Nargis Fakhri, to promote his ebook “Cryptocurrency for Beginners”. Shilpa Shetty’s husband- the well-known Indian businessman Raj Kundra also faced ED over his involvement in Bhardwaj’s company.
It is worth mentioning that the Pune police had arrested Bhardwaj in April at New Delhi airport when he was returning from Dubai. Since then, Bhardwaj has offered to repay his investors in Indian Rupees.
The price of Bitcoin has increased in the light of the incident by that time, the thing that resulted in investors rejecting Bhardwaj’s proposal in fears of losing out on profits they could make if they get involved in dealing with him.