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Police Arrests 4 Allegedly Involved In A $14m Crypto Scam

Law officials in India have arrested four people for allegedly scamming people approximately of approximately $14 million. The quad is part of a gang that launched Cashcoin, a cryptocurrency that was reportedly used to amass wealth from people and cheat them of their earnings. Their lawyer has, however, refuted the claims on their behalf, according to a local media report.

An Allegation of Rs 100 crore Scam

Per the report, Rajnikant Kumavat (46), Sanjay Sontakke (44), Kirankumar Panchsara (38), and Alpesh Barodia (32) were allegedly part of the gang that launched Cashcoin. They were apprehended in Mumbai, Surat, and Uttar Pradesh respectively. According to the police, the accused and one other person who is yet to be found had cheated people of Rs 100 crore (approximately $14 million) while offering their cryptocurrency for sale.
Further light into the matter reveals that they had promoted the virtual asset in Mumbai, Surat and other parts of the country. They had also promised investors that their money would be doubled within two months. However, this was only the case at the initial stage to lure more investors before defaulting.

Plaintiff Reveals He Was Scammed 12 million rupees

The dealings of the gang were first revealed by an investor, Umeshchand Jain who claimed that he was scammed 12 million rupees ($168,102) by the group. A law official also stated that the gang after receiving money from the complainant transferred it to another bank. Therefore, they have taken measures to hold down the funds by freezing Cashcoin’s account in various parts of the country.
Accordingly, the Crime branch (unit XII) has lodged the offence as a breach of trust, cheating, criminal conspiracy under the Indian Penal Code. Reports also reveal that these complaints from the police might invoke acts such as the Chit Funds Act and the Maharashtra Protection of Interest of Depositors Act.

Accused Lawyer Says His Clients are Innocent

On the other hand, Ajay Dubey, the accused lawyer stated that his clients are innocent and were wrongly arrested. Dubey also added that they had not cheated and no crime was committed because the transactions were based on cheques. Therefore, the Indian Penal Code sections 419, 420, 406 and 409 cannot be applied to the case.
The Reserve Bank of India (RBI) has been warning banks in the country as well as citizens on the negative impact of investing in cryptocurrencies. RBI had also encouraged banks to close a customer’s account if found trading these assets. So far, some banks like Kotak Mahindra Bank have followed the directives. India has also made it known that virtual currencies are not a legal tender in the country.

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