India Steps Up Raid on App-Based Crypto Fraud

India’s Central Investigation Agency (CIA) has initiated a raid to investigate crypto app investment fraud.

This extensive operation covers 30 different locations across ten states and Union Territories, targeting individuals and entities connected to the fraudulent HPZ Token App, as reported by India Today.

The investigation has focused on two private firms and their directors, who are accused of deceiving the public by promoting investments in a fake scheme for renting cryptocurrency mining equipment. The searches have resulted in the confiscation of significant evidence, including documents, mobile phones, hard drives, SIM cards, debit cards, and email accounts, that are crucial to the investigation.

The HPZ Token App Claimed to Offer Profits on Investments

The HPZ Token App enticed users to expect significant investment returns via cryptocurrency mining equipment, focusing on well-known currencies like Bitcoin. Scammers attracted victims by assuring them of substantial earnings from investing in Bitcoin mining.

The inquiry has pinpointed roughly 150 bank accounts purportedly utilized by the defendant to gather investments from contributors.

#CBI today conducted raids across 30 locations in 10 states and Union Territories as part of an investigation into a fraudulent investment scheme linked to the HPZ Token App. The investigation is regarding #misleading the public into investing in a non-existent #cryptocurrency…

— All India Radio News (@airnewsalerts) May 1, 2024

Investigators have found that initial payments to confident investors were likely a strategy to gain their trust before the funds were discreetly sent overseas. Often, these funds were exchanged for cryptocurrencies or transferred via the informal Hawala system. This revelation came as part of the Central Bureau of Investigation’s (CBI) efforts to tackle a fraudulent scheme linked to cryptocurrency investments through an application, closely following the Enforcement Directorate (ED) of India’s announcement of uncovering a significant cryptocurrency-related money laundering operation tied to a gaming app.

The authorities also managed to freeze cryptocurrency assets valued at approximately ₹90 crore ($10 million) associated with this fraud. The ED confiscated these assets, spread across 70 accounts in prominent cryptocurrency exchanges, such as Binance, ZebPay, and WazirX, and moved them to their cryptocurrency wallet. The application in question, E-Nugget, presented itself as a gaming platform, luring players with promises of substantial investment returns.

This news follows reports that many Indians are using crypto as part of their retirement plans.

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