Cryptocurrency fraud cases: HP Police SIT searches at 35 locations recover 'crucial' evidence

The Special Investigation Team (SIT) of the Himachal Pradesh Police probing the cryptocurrency fraud cases conducted searches at a total of 35 locations in the hill state, Punjab and Chandigarh on Saturday, an official statement said.

The SIT personnel recovered crucial evidence in the form of documents, property records, mobile phones and other digital devices, the statement added.

The searches were done on the residential premises of accused/suspects at various locations in Kangra, Mandi, Una, Chamba, Hamirpur, Bilaspur, Shimla and Baddi districts besides Punjab and Chandigarh, according to the statement issued by the Himachal Pradesh Police headquarters.

The SIT has also obtained various details related to the proceeds of the crime, the statement said.

According to police, the fraudsters from Himachal Pradesh's Mandi district created local cryptocurrency and duped thousands of innocent people of hundreds of crores of rupees in the state.

'The evidence collected during these searches will play a vital role in our ongoing investigation. We are committed to a thorough and fair investigation, leaving no stone unturned in our quest for justice,' the statement read.

The scam began in 2018 and the majority of the victims are from Mandi, Hamirpur and Kangra districts, police said.

The fraudsters lured innocent people by promising high returns in a short span of time on the cryptocurrency investments and created a network of investors who further created a chain by involving their known persons, they added.

Fifty-six complaints have been received in total since 2022 of which more than 50 were received in the current year, police said.

It was found during investigation that the modus operandi was similar and the accused were common following which the scam was unearthed, they said.

Police said 10 cases of cheating, fraud, criminal conspiracy and money laundering and promotion of fake crypto have been registered.

Five people, including two of the three prime accused namely Sukhdev Thakur and Hemraj Thakur, have been arrested, while Subhash Sharma, another key accused, is still at large, they said.

Deputy Inspector General (Northern Range) Abhishek Dhullar, who is heading the SIT, had earlier said thousands of innocent people were duped of hundreds of crores of rupees in the state and the exact amount is yet to be ascertained.

The accused used a combination of misinformation, deception and threats to maintain control over their scheme and continue extracting money from unsuspecting investors by manipulating the cryptocurrency prices, which led to huge financial losses to the victims, he added.

The miscreants approached people with an investment plan related to a locally created cryptocurrency known as 'Korvio Coin' also called as KRO coins, police said, adding they charged an initial activation fee for getting their accounts activated by promising substantial returns.

Three or four kinds of cryptocurrency were used, police said.

Cryptocurrency is a digital currency designed to work as a medium of exchange through computer network that is not dependent on any central authority such as the government or bank to uphold or maintain it.

Police said the criminals used a Ponzi scheme pattern -- a type of investment scam in which returns are paid to the earlier investors from the capital contributed by new investors rather than from legitimate profits.

False websites in which the cryptocurrency prices were manipulated and inflated were created by the accused and later shifted to a new cryptocurrency called 'DGT coin', police said.

The prices of the currency was deliberately lowered after the investors had purchased the DGT coins on higher rate, causing financial losses to them, they said.