Indian Police Arrest Crypto Scammer For $31M Fraud

A man has been arrested in India’s Thane, Maharashtra, for duping 1,441 investors in a fake cryptocurrency scam. According to local reports, the crypto scam likely defrauded investors of more than 250 billion INR, or $31M USD, with its victims spread across India.

The accused, Ritesh Panchal, who sometimes uses the alias Ritesh Sikalgir, used the names of two fake crypto operations, “Magic 3x” and “SMP”, to fool investors. So far, 24 people, cheated of a cumulative 44 million INR, have come forward. 

Panchal was able to scam investors by promising returns of almost double on their investments in just 10 to 20 months, under the fake Magic 3x crypto scheme.

Panchal is being investigated by the Economic Offence Wing (EOW) of Thane police, which tackles economic and financial offences. EOW had the man arrested after a probe revealed that he held four separate bank accounts with Mumbai-based banks. 

In a similar incident, Satish Kumbhani, the founder of BitConnect, was booked by police in Pune (Maharashtra, India) for running a global Ponzi scheme involving an open-source cryptocurrency connected with a high-yield investment program.

Just one month ago, the Indian government’s Directorate of Enforcement (ED) launched a probe into Binance-acquired WazirX for the alleged laundering of $350M USD.

26% of Indian Investors Are Worried About Hacks and Exploits

In a recent crypto exchange survey, KuCoin estimated that 115 million Indian citizens have invested in cryptocurrency in some from, representing approximately 11% of the nation’s population, and placing India 7th in the rankings in terms of crypto ownership by country.

At least 10 cryptocurrency exchanges are under investigation in the country for allegedly laundering more than 10 billion rupees ($125 million USD).

KuCoin further indicated that 26% of Indian investors are worried about hacks and exploits, while 23% shared concerns about losing their funds in the event of a security incident.

According to crypto investigation tool Chainalysis, popular scam websites in India include coinpayu.com, adbtc.top, hackertyper.net, dualmine.com, and coingain.app. These five websites have been visited in India a total of 4.6 million times.

On the Flipside

  • Indian Finance Minister Nirmala Sitharaman has advised buyers to be cautious while dealing with crypto.

Why You Should Care

The increasing number of crypto scams in India has led to investors being apprehensive about investing in new tokens.

This article is for information purposes only and should not be considered trading or investment advice. Nothing herein shall be construed to be financial legal or tax advice. Trading Forex, cryptocurrencies, and CFDs poses a considerable risk of loss

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Author

Akriti is a Zurich-based reporter, focused on the political, regulatory, and legislative developments around crypto. She is a business journalist with over six years of experience working as a correspondent for organizations like Channel NewsAsia and Bloomberg TV India. In that time, Akriti has covered news in the finance, pharma, and state sectors.