Enforcement Directorate Probes International Cryptocurrency Investment Fraud
The Directorate of Enforcement (ED) has uncovered an alleged ₹300 crore (approximately $35 million) cryptocurrency over-the-counter (OTC) investment fraud involving a network of self-styled crypto influencers based in Bengaluru.
According to investigators, the accused allegedly targeted international investors by offering discounted cryptocurrency tokens before their public listings. While smaller transactions were reportedly completed initially to build confidence, authorities allege that larger investments were either only partially honoured or not delivered at all.
The case also highlights the increasing importance of financial due diligence, digital asset governance, and auditing services in india as cryptocurrency-related investment frauds become more sophisticated and cross-border in nature.
Investigation Began After Complaint From Dutch Company
The investigation was initiated by the ED's Bengaluru Zonal Office under the Prevention of Money Laundering Act (PMLA) following a First Information Report registered by the Cyber Crime Police Station, South Andaman.
The case originated after a commercial entity based in the Netherlands alleged significant losses in over-the-counter cryptocurrency transactions.
Officials stated that while the initial complaint estimated losses of around $10 million, subsequent financial intelligence indicated that the suspected fraud exceeded $35 million, involving multiple foreign accounts.
Alleged Scheme Used Social Media to Attract Investors
According to investigators, the accused projected themselves as prominent cryptocurrency industry experts and key opinion leaders through multiple online platforms, including:
- Telegram
- Dedicated investment websites
- Cryptocurrency conferences and industry events
Authorities allege that investors were promised exclusive access to discounted allocations of popular digital tokens before their public exchange listings.
To establish credibility, the network allegedly completed several smaller transactions successfully before encouraging victims to invest substantially larger amounts.
Funds Allegedly Diverted After Crypto Market Rally
Financial forensic analysis indicates that proceeds from the alleged scheme were transferred through multiple cryptocurrency wallets.
According to the ED, the funds were ultimately routed to Ravindra K, who investigators identify as the alleged mastermind behind the over-the-counter cryptocurrency operations.
The agency has also named:
- Mohammed Waseem
- Saurabh Diwan
- Vaibhav Gupta
Officials allege these individuals were involved in investor outreach and managing token allocation promises.
Investigators claim that once cryptocurrency prices increased significantly, the accused allegedly stopped delivering the promised digital assets and diverted investor funds toward:
- Luxury real estate.
- Business investments.
- Personal expenditure.
ED Conducts Searches in Bengaluru
Based on intelligence gathered during the investigation, enforcement officials carried out coordinated searches at multiple premises across Bengaluru.
During the raids, authorities seized:
- Digital storage devices.
- Email records.
- Encrypted cryptocurrency wallet credentials.
- Virtual assets amounting to 8,700 USDT.
The recovered evidence is being examined as part of the ongoing money laundering investigation.
More Victims May Emerge
According to the ED, investigators believe numerous additional foreign institutional investors and high-net-worth individuals may have suffered losses through similar over-the-counter cryptocurrency transactions.
Authorities suspect several affected investors have not yet filed formal complaints.
The investigation is continuing with assistance from international law enforcement agencies as officials work to:
- Identify additional cryptocurrency wallets.
- Trace international fund movements.
- Freeze suspected illicit assets.
- Establish the complete financial network.