ED Seizes $190M in Crypto, Rs 1646 Crore in BitConnect Ponzi Scheme Crackdown
The Enforcement Directorate (ED) in Ahmedabad has seized approximately $190 million in cryptocurrency, along with other investments worth Rs 1,646 crore, linked to the notorious BitConnect Ponzi scheme. This action follows the collapse of BitConnect, which has highlighted the urgent need for regulatory reform and a shift in investor behaviour.
The main suspect in the BitConnect case, Divyesh Darji, is believed to have orchestrated the scheme. Promoters of BitConnect lured investors with promises of high returns, falsely claiming an average daily return of 1% on their platform. They presented their operations as investment opportunities, using a 'volatility software trading bot' to dupe investors. In reality, BitConnect was a Ponzi scheme, with early investors' returns coming from money paid by later investors.
Authorities, including U.S. federal agents, have joined the investigation. During raids, they confiscated not only cryptocurrency but also more than $15,000 in cash, an SUV, and various electronic devices. The seized assets are worth around Rs 1,646 crore and were taken under the Prevention of Money Laundering Act (PMLA). The BitConnect scheme defrauded approximately 4,000 investors in 95 countries of around $2.4 billion. Some desperate investors resorted to extreme measures, including abductions, due to their staggering fund losses.
The ED's action against BitConnect sends a strong message to those involved in such schemes. The seized assets will now be used to compensate the defrauded investors. As investigations continue, authorities worldwide are urged to work together to prevent and prosecute such crimes, while regulators are called upon to strengthen measures to protect investors.
