fbpx
Money

Indian Police Arrest Operators Of $2.6 Million Bitcoin Ponzi

Authorities in India have arrested two individuals accused of operating a bitcoin Ponzi scheme that swindled some 300 bitcoins, approx. $2.6 million in current prices, from 5000 victims.

The duo, alleged to be running a multi-level marketing (MLM) scheme that incentivized investors to lure in others into the scheme, promised high returns on bitcoin investments through a company called Bitmineplus. The company encouraged investors to deposit or buy bitcoin from the company, which it then held, to offer monthly returns as high as 12%, details from its still-functioning website reveals.

According to The Times of India, the platform began soliciting investments upon launch in December 2016 and, in addition to the 12% returns, offered 5% referral income for early investors with an additional 10% in commissions for bringing in additional people.

An investigating official said:

Their basic idea was to kick-start a multilevel marketing scheme involving bitcoins. The people were given monthly payouts and additional income for referring the scheme to more people.

After paying investors their returns in bitcoin initially, the company began offering dividends in ‘BMP’, its own custom-created cryptocurrency that offered no value. Eventually, the operators fled with their investors’ money before law enforcement caught up and apprehended the two individuals.

“Jangra [the mastermind behind the ponzi] had planned to shift his investors to his own cryptocurrency after getting a good sum of investment, but rising debt and the daily pressure from his investors made him flee with the money,” a senior police official said.

The company, which threw lavish parties at 5-star hotels to gain investors’ confidence, ultimately lured over 5,000 individuals for over a year before the scheme collapsed in February 2018.

“We have identified at least 5,000 IDs which have been duped,” Deputy Commissioner of Police (cyber Cell) Anyesh Roy said on Sunday, according to the Hindu. “For the first few months, the income came in but eventually, it stopped after which the investors started to ask questions.”

Cryptocurrency-related fraud continues to be prevalent in Asian countries with conmen justifying unrealistically high short-term gains by purporting to invest in cryptocurrencies.

Earlier this month, a major cryptocurrency-related ICO fraud in Vietnam saw authorities, including the office of Vietnam’s prime minister, crack down on a sweeping scheme that conned 32,000 citizens out of a reported 15 trillion dong, about $660 million. A similar nation-wide Chinese pyramid scheme purporting to be a blockchain platform swindled 80 million yuan ($13 million) from 13,000 investors earlier this year.

This story originally appeared in CCN.

Join The Discussion

Trump's Plan To End Shutdown Falls Flat
Trump’s Plan To End Shutdown Falls Flat [Video]
World's 26 Richest People Own As Much As Poorest 50%
World’s 26 Richest People Own As Much As Poorest 50%
Thailand Signals Shift In Refugee Policy After Rahaf Mohammed
Thailand Signals Shift In Refugee Policy After Rahaf Mohammed [Video]
Brexit Plans In Chaos After UK Parliament Rejects Proposal
Brexit Plans In Chaos After UK Parliament Rejects Proposal [Video]
How To Buy Bitcoin Anonymously
How To Buy Bitcoin Anonymously
Number Of Bitcoin ATMs Hits 4,000 Globally
Bitcoin ATMs Hits 4,000 Globally-Why Is It Growing So Fast?
Is Bitcoin Building Support Above $3,500
Is Bitcoin Building Support Above $3,500?
Belarus Allows Traders To Buy Shares With Bitcoin
Belarus Allows Traders To Buy Shares With Bitcoin
10 Marketing Trends To Watch In 2019
10 Marketing Trends To Watch In 2019
40+ Video Marketing Statistics For 2019
40+ Video Marketing Statistics For 2019 [Infographic]
Emerging Email Marketing Trends To Survive 2019 And Beyond
Emerging Email Marketing Trends To Survive 2019 And Beyond [Infographic]
Visual Trends To Be Aware Of In 2019
Visual Trends To Be Aware Of In 2019 [Infographic]
The Latest Social Media Automation Rules In 2019
The Latest Social Media Automation Rules In 2019
4 Tips To Help You With The Constant Changes In Social Media
4 Tips To Help You With The Constant Changes In Social Media
Instagram's Testing Side-Scrolling Feed View, Similar To Stories
Instagram’s Testing Side-Scrolling Feed View, Similar To Stories
The 10 Best Instagram Tools For 2019
The 10 Best Instagram Tools For 2019
What Is Your Therapist Listening For
What Is Your Therapist Listening For?
Wish You Were Smarter
Wish You Were Smarter? These 4 Brain Hacks Can Help You Get There
Weightlifting Less Than An Hour Per Week Could Increase Your Longevity
Weightlifting Less Than An Hour Per Week Could Increase Your Longevity
Your Environment May Affect Your Eyes More Than You Realize
Your Environment May Affect Your Eyes More Than You Realize
Trump's Plan To End Shutdown Falls Flat
Trump’s Plan To End Shutdown Falls Flat [Video]
Thailand Signals Shift In Refugee Policy After Rahaf Mohammed
Thailand Signals Shift In Refugee Policy After Rahaf Mohammed [Video]
Brexit Plans In Chaos After UK Parliament Rejects Proposal
Brexit Plans In Chaos After UK Parliament Rejects Proposal [Video]
Coming To Canada 'Worth The Risk,' Says Saudi Teen Refugee
Coming To Canada ‘Worth The Risk,’ Says Saudi Teen Refugee [Video]