Vipul Mishra
The Directorate of Enforcement arrested Nitin Gaur, who is Ajay Bhardwaj’s brother-in-law, under the Prevention of Money Laundering Act (PMLA).
The Directorate of Enforcement (ED) arrested Nitin Gaur, the brother-in-law of Ajay Bhardwaj, in connection with a Rs 6,606 crore cryptocurrency case involving M/s Variable Tech Pte Ltd and its promoters in the GainBitcoin Ponzi scam. This arrest was made under the Prevention of Money Laundering Act (PMLA).
The probe agency launched an investigation based on multiple FIRs filed by Maharashtra Police and Delhi Police against the company. These FIRs target the company’s late founder Amit Bhardwaj, as well as other family members, including Ajay Bhardwaj, Vivek Bhardwaj, Simpy Bhardwaj, Mahender Bhardwaj, and numerous multi-level marketing (MLM) agents.
They allegedly duped investors by collecting large sums of Bitcoin, valued at Rs 6,606 crore as of 2017, promising monthly returns of 10 per cent in the form of Bitcoins.
These funds were supposedly for Bitcoin mining operations that would generate substantial crypto-asset returns. However, the promoters are accused of defrauding investors and concealing the ill-gotten Bitcoins in anonymous online wallets.
Investigations using blockchain technology have uncovered that Nitin Gaur knowingly and willingly received proceeds of crime in his cryptocurrency account on the Binance exchange from a wallet controlled by Ajay Bhardwaj.
The ED investigation revealed that Gaur assisted Ajay Bhardwaj in concealing and layering the proceeds of crime generated through this scam.
A search operation at Gaur’s residence resulted in his arrest on December 29. He was subsequently transported to Mumbai on transit remand and presented before the PMLA Special Judge in Mumbai on December 30.
The court has granted ED custody for custodial interrogation until January 6, 2024.
The ED also conducted searches at the premises of suspected hawala operators connected to the GainBitcoin scam promoters. It was discovered that many crypto traders were converting cryptocurrencies like Bitcoin, Ethereum, USDT, and Tron into Indian Rupees without proper accounting, indicating potential involvement in money laundering. The ED has summoned these traders for questioning.
The investigation has further revealed that the accused promoters are highly skilled in crypto-asset transactions, using fake KYC documents, VPNs, and other methods to conduct complex transactions such as mixing, swapping, and peer-to-peer exchanges to conceal their criminal proceeds.
During the search, authorities seized Rs 16.7 lakh in cash and various digital devices. While the main accused, Ajay Bhardwaj and Mahender Bhardwaj, remain at large, Simpy Bhardwaj, who was arrested by the ED on December 17, is currently in judicial custody.
The ED has attached properties worth Rs 69 crore and is seeking international cooperation in the case.
Further investigation is ongoing.