The Enforcement Directorate (ED) has made a significant breakthrough in its ongoing money laundering probe related to a bitcoin-based ponzi scheme, as it arrested Nitin Gaur, a Delhi resident allegedly involved in the illicit operation. Gaur was apprehended in Delhi on December 29 and later brought to Mumbai on a transit remand. Subsequently, on December 30, a Mumbai city court remanded him in ED custody until January 6.
The investigation revolves around the activities of Variable Tech Pte Ltd, a Singapore-based company accused of orchestrating the bitcoin-based ponzi scheme. Nitin Gaur’s arrest is seen as a crucial development in the case, shedding light on the intricate web of financial transactions linked to the illicit operation.
Nitin Gaur is identified as the brother-in-law of Ajay Bhardwaj, a key figure in the ponzi scheme who, along with Mahender Bhardwaj, remains at large. Simpy Bhardwaj, Ajay’s wife, was arrested by the ED on December 17.
The ED initiated its probe into the ponzi scheme in 2018, following multiple cases registered by the Maharashtra and Delhi police against Variable Tech and its key players. The accused individuals include late Amit Bhardwaj, Ajay Bhardwaj, Vivek Bhardwaj, Simpy Bhardwaj, Mahender Bhardwaj, and other multi-level marketing agents.
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Variable Tech allegedly enticed unsuspecting investors by promising high returns through a cryptocurrency developed by the company. However, the promised returns were never delivered, leading to widespread financial losses for investors. The ED filed its first chargesheet in the case in 2019.
An ED official revealed that the agency is also examining the role of several cryptocurrency traders. The investigation indicated that these traders accepted cryptocurrency from wallets controlled by the Bhardwaj family and converted them into Indian currency without proper accounting measures.
The ED has conducted searches at the premises of hawala operators suspected to be associated with the promoters of Variable Tech. These operators have been asked to explain transactions deemed suspicious by the investigative agency. Nitin Gaur, specifically, is alleged to have received a portion of the proceeds of the crime.
Leveraging the transparency of blockchain technology, the ED’s investigation revealed that Gaur knowingly received proceeds of crime in his cryptocurrency account on the Binance exchange from a wallet operated by Ajay Bhardwaj. The ED alleges that Gaur actively assisted Bhardwaj in concealing and layering the ill-gotten gains.
The accused individuals are believed to have collected bitcoins from investors, promising a monthly return of 10%. However, the funds were purportedly diverted for bitcoin mining, and investors were left empty-handed. The ED official stated, “The promoters cheated the investors and concealed the ill-gotten bitcoins in obscure online wallets.”
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In connection with the case, the ED has already attached assets worth ₹69 crore and sought assistance from foreign authorities to conclude its comprehensive investigation into the bitcoin-based ponzi scheme.