The person behind GBMiners, the firm credited for introducing bitcoin mining in India, has been arrested for swindling over 8000 investors of INR 2,000 crores in the state of Maharashtra alone. Amit Bhardwaj, one of most well-known person in the digital currency world, and his brother Vivek Bharadwaj were arrested after evading the police for over the year.
This is the first time that an enforcement case investigation report (ECIR) was filed in India under the Prevention of Money Laundering Act in Mumbai. More people are involved in the ECIR such as Ajay Bhardwaj, Rupesh Singh, Hemant Chauhan, Hemant Suryavanshi, Kaka Ravde and more.
The Reserve Bank of India (RBI), the Enforcement Directorate (ED) and the Cybercrime Cell of Pune Police are all going to take actions against the culprits in this case. The case could have never seen the day for most of the investors were indulged in illegal activities while making their investments and it was actually Parvendra Singh, a businessman from Nanded that first filed a complaint and therefore informed the authorities about the scam.
The accused, Amit Bhardwaj reportedly cheated his investors by insisting they should invest their money using Bitcoin-based Ponzi schemes while maximizing on his reputation as a cryptocurrency entrepreneur. The official figure of the fraud is said to be around INR 2,000 crores but many reports suggest that the actual sum could actually stand anywhere between INR 5,000 crores and INR 13,000 crores.
Bhardwaj also relied on his contacts in Bollywood such as Shilpa Shetty, Neha Dhupi and Huma Qureshi to publicize his book, Crytocurrency for beginners and therefore build a brand trust to his name. From there on, he would encourage middle-class investors to pour huge sums of money in cryptocurrencies using a multi-level marketing (MLM) model.
Bhardwaj first stepped in the cryptocurrency universe by launching HighKart, which was the first bitcoin based online retailer in India and also possessed additional cryptocurrency firms like GainBitcoin, MCAP, GB21 and GBMiners obviously.
A petition issued on change.org and signed by over 1,150 people also called for the arrestation of GBMiners’ founder. The user, who started the petition intended to the Commissioner of Police, Delhi, shared how he was cheated of his bitcoins investments from Bhardwaj.
“We spoke for an hour or so where he explained to me about the business concept, payouts, his “5-year” plan and much more. The Company is originally registered in Singapore in the name VARIABLETECH PVT LTD. He told me that this was because of the bitcoin-friendly laws in Singapore. He said the mining pool of the Company is in China and for every contract, we buy by paying 1 BitCoin, the Company would pay us 0.1 BTC for 18 months. One week after coming back to Kerala I opened 6 positions in his company by paying 6 BitCoins. Soon the website was closed down for maintenance. I requested for my first withdrawal after 3 weeks and now even after one and a half years – my withdrawals are still pending. I contacted the support n number of times. Result: No Response. I e-mailed Amit. Result: So Response. 2 Months later after a meeting with a couple of top names in the Indian BitCoin Community, I told them about my experience with Amit and they told me more about him – He is a fraud!”
Read the account of the Kerala-based user.