The Enforcement Directorate (ED), under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, has attached movable and immovable properties belonging to businessman Raj Kundra. The properties, valued at Rs 97.79 crore, are linked to a bitcoin ponzi scam. Among the attached properties is a flat in Juhu, Mumbai, registered in the name of Kundra’s wife, actor Shilpa Shetty. The ED’s investigation was initiated based on multiple FIRs registered by Maharashtra Police and Delhi Police against Variable Tech Private Limited and individuals associated with it, including the late Amit Bhardwaj, Ajay Bhardwaj, Vivek Bhardwaj, Simpy Bhardwaj, Mahender Bhardwaj, and others.
A Ponzi scheme is an investment fraud that pays existing investors with funds collected from new investors. Ponzi scheme organizers often promise to invest your money and generate high returns with little or no risk. But in many Ponzi schemes, the fraudsters do not invest the money.
Accused Collected Bitcoins Worth Rs 6,600 Crore with False Promises
The accused individuals allegedly collected a significant amount of funds in the form of bitcoins, amounting to Rs 6,600 crore in 2017 alone. They lured people with false promises of a 10% monthly return in the form of bitcoins. The collected bitcoins were supposed to be used for bitcoin mining, with investors expecting substantial returns in crypto assets. However, the promoters deceived the investors and concealed the illicitly obtained bitcoins in obscure online wallets.
Raj Kundra’s Involvement and Possession of Bitcoins
According to the ED’s investigation, Raj Kundra received 285 bitcoins from Amit Bhardwaj, the mastermind and promoter of the GainBitcoin ponzi scam. These bitcoins were given to Kundra for setting up a bitcoin mining farm in Ukraine. The bitcoins were sourced from the proceeds of crime collected by Amit Bhardwaj from unsuspecting investors. As the deal did not materialize, Raj Kundra is still in possession of the 285 bitcoins, which are currently valued at over Rs 150 crore.
Arrests and Accused Still at Large
Multiple search operations were conducted in connection with the case, leading to the arrests of Simpy Bhardwaj on December 17, 2023, Nithin Gaur on December 29, 2023, and Nikhil Mahajan on January 16, 2023. All three individuals are currently in judicial custody. However, the main accused, Ajay Bhardwaj and Mahendra Bhardwaj, are still absconding.
Previous Attachments and Legal Proceedings
Previously, the ED had attached properties worth Rs 69 crore in relation to this case. On June 11, 2019, the prosecution filed a complaint, followed by a supplementary complaint on February 14, 2024. These complaints were taken into consideration by a special PMLA court.