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ED arrests Nitin Gaur in case linked to bitcoin-based ponzi scheme

Jan 03, 2024 03:06 PM IST

Nitin Gaur was arrested in Delhi on December 29, and brought to Mumbai where a city court remanded him in ED custody till January 6

MUMBAI: The Enforcement Directorate (ED) has arrested a Delhi resident Nitin Gaur in connection with its money laundering probe linked to proceeds of crime from a bitcoin-based ponzi scheme operated by the Singapore-based Variable Tech Pte Ltd, people familiar with the matter said.

ED initiated an investigation into the ponzi scheme in 2018, based on multiple cases registered by Maharashtra and Delhi police. (HT FILE PHOTO)
ED initiated an investigation into the ponzi scheme in 2018, based on multiple cases registered by Maharashtra and Delhi police. (HT FILE PHOTO)

Gaur was arrested in Delhi on December 29, and brought to Mumbai on a transit remand. A city court on December 30 remanded him in ED custody till January 6.

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An ED official said Nitin Gaur is the brother-in-law of Ajay Bhardwaj, who along with Mahender Bhardwaj, are the main accused in the case and on the run. Ajay Bhardwaj’s wife Simpy was arrested by ED on December 17.

The federal agency initiated an investigation into the ponzi scheme in 2018, based on multiple cases registered by Maharashtra and Delhi police against Variable Tech, late Amit Bhardwaj, Ajay Bhardwaj, Vivek Bhardwaj, Simpy Bhardwaj, Mahender Bhardwaj and other multi-level marketing agents.

According to the agency, Variable Tech allegedly lured gullible investors by promising them high returns in the form of cryptocurrency developed by the company. No returns were ever paid back to investors.

ED filed the first chargesheet in the case in 2019,

An agency official said the agency was also investigating the role of many crypto traders after its probe indicated that many of them accepted cryptocurrency from wallets under the control of the Bhardwaj family and converted them into Indian currency without any accounting trail.

The agency has carried out searches at the premises of some hawala operators suspected to be associated with the firm’s promoters and asked them to explain the suspicious transactions. According to ED, Nitin Gaur was alleged to have received a part of the proceeds of crime in the case.

“ED’s investigation, leveraging cryptocurrency’s public ledger, that is blockchain, revealed that Gaur has knowingly and willingly received proceeds of crime in his cryptocurrency account opened on Binance exchange from a wallet operated by his brother-in-law and prime accused, Ajay Bhardwaj, “ a second ED official said. He alleged that Gaur helped Bhardwaj to conceal and layer the proceeds of the crime.

It is alleged that the accused collected bitcoins from gullible investors, who were promised a return of 10% per month. The collected bitcoins were allegedly supposed to be utilised for bitcoin mining and investors were supposed to get huge returns in crypto assets. “But the promoters cheated the investors and concealed the ill-gotten bitcoins in obscure online wallets, “ the ED official said.

ED has attached assets worth 69 crore and has sought assistance of some countries to conclude its probe

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