Police Bust Cryptocurrency Investment Fraud

Based on a complaint given by a victim of a fake investment racket, the head of operations of a Bengaluru-based cryptocurrency website, B M Jagadeesha, was busted by the Cyberabad Police for luring people into investing in a virtual mining company

The website allegedly promised investors a profit of 180 times their initial investment.

A special team led by Inspector Mohammad Riyazuddin of the Cyber Crime cell of the Cyberabad Police Department, tracked down Jagadeesha in Bengaluru and arrested him. He was produced before the Chief Metropolitan Magistrate of Bengaluru and brought back to Hyderabad on a transit warrant and produced in the Miyapur court. Later on, he was interrogated by the police.

The plaintiff told the police that the company had failed to pay the promised monthly returns. When queried, Jagadeesh had apparently claimed that the company was based in Germany and that he would resolve the issue soon. But he allegedly never did.

Further investigation revealed that the website was registered under "Excellent Business Centre", Friedrich Street, Germany. Thaao July (Chief Executive Officer), K Nagarajan (Head Of Administration), Adidulla (Mining Head) and Lella Coco (Finance Head) were named as the management team.

It was also revealed that the accused showed the business (with its website being 3gcoin.eu) as having three promoters, of which two names were fictitious and the third was that of a deceased person K Nagaraju.

As per the website, a "gram" of virtual crypto currency was valued at 3-4 euros. When a customer wished to generate crypto currency, he or she would be directed to open an account in the company website 3gcoin.gold. The customer would then be directed to enter his or her credentials including bank account details, PAN and address proof. These credentials would then be verified by the administrator. After entering the credentials and receiving an unique identification number in their email, they are directed to transfer a registration fee of 30 euros to the company's account in the name of late K Nagaraju.

Around 500 agents are currently employed with the company. Any person who introduces the company to an investor gets 20% of the latter's registration fee as commission.

At the time of arrest, Jagadeesha had made Rs 2 crores. Most of the amount earned by the company had been distributed as commission to the agents.

The police has warned citizens of the existence of similar illegal websites such as Wowcoin, Onecoin, Richcoin and Litcoin. The case is still being investigated by the Cyberabad Police to understand the extent of the crime.