In a significant development, the Directorate of Enforcement (ED) in India has arrested Nitin Gaur, brother-in-law of Ajay Bhardwaj, in connection with the multi-billion-dollar GainBitcoin Ponzi scam. The arrest is part of the ongoing investigation into the cryptocurrency fraud case involving M/s Variable Tech Pte Ltd and its promoters.
Under the Prevention of Money Laundering Act (PMLA), Gaur faces charges related to concealing and layering the proceeds of crime generated through the GainBitcoin Ponzi scheme. The Supreme Court of India, responding to a petition filed by Ajay Bhardwaj, directed a CBI investigation into the case while instructing the ED to continue its ongoing inquiry under the PMLA, 2002.
The GainBitcoin Ponzi scheme, which promised monthly returns of 10%, collected hundreds of thousands of Bitcoins. Investigations revealed a web of deception, with promoters allegedly hiding ill-gotten Bitcoins in anonymous online wallets. GainBitcoin is accused of amassing around 20,000 crore INR ($2.4 billion) in Bitcoin from victims.
Nitin Gaur, brother of Simpy Bhardwaj, received proceeds of crime in his Binance exchange cryptocurrency account from a wallet controlled by Ajay Bhardwaj. Gaur actively assisted Ajay in illicit financial maneuvers associated with the Ponzi scheme. Simpy Bhardwaj, arrested last month, remains under judicial custody.
Following a search operation at Gaur's residence on December 29, he was brought to Mumbai for further proceedings. The PMLA Special Judge in Mumbai granted ED custody for custodial interrogation until January 6, 2024.
Simultaneously, ED conducted searches at premises linked to suspected hawala operators associated with GainBitcoin scam promoters. Crypto traders converting various cryptocurrencies into Indian Rupees without proper accounting have been summoned for questioning, hinting at potential money laundering.
The GainBitcoin investigation unveiled the accused promoters' adeptness in crypto-asset transactions, utilizing fake KYC documents, VPNs, and intricate methods like mixing, swapping, and peer-to-peer exchanges to camouflage criminal proceeds. Main accused Ajay Bhardwaj and Mahender Bhardwaj remain at large. The intensified probe sheds light on the complexity of India's largest crypto Ponzi scam. Stay tuned for further updates on this unfolding crypto legal saga.
