New Delhi: The Enforcement Directorate (ED) has frozen bank deposits worth Rs 2.18 crore after conducting multi-state searches against an Indian national accused of illegally converting cryptocurrency worth nearly Rs 600 crore through various Indian crypto exchanges.
The searches, carried out on February 20 under the Foreign Exchange Management Act (FEMA), took place in Delhi, Jaipur (Rajasthan), and Mumbai (Maharashtra). The case revolves around the large-scale conversion of cryptocurrency and subsequent fund transfers to undisclosed beneficiaries, the ED stated.
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The probe was initiated following a media report about an Indian national, Chirag Tomar, who was sentenced to prison in the United States for defrauding hundreds of victims out of over USD 20 million by operating fake websites that mimicked Coinbase, a well-known cryptocurrency exchange. Tomar, who was convicted by a US court in November last year, could not be reached for a response to the ED’s allegations.
According to investigators, cybercriminals used search engine optimization (SEO) techniques to manipulate search results, making their spoofed websites appear at the top when users searched for legitimate crypto platforms. These fraudulent sites looked identical to trusted exchanges, except for altered contact details.
When victims attempted to log in, the fake websites would reject their credentials, prompting them to call the provided customer support number. This call would redirect them to a call center allegedly operated by Tomar. Once fraudsters gained access to victims’ accounts, they swiftly transferred cryptocurrency holdings into wallets under their control.
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The stolen digital assets were then sold on the website localbitcoins.com and converted into Indian Rupees through Indian crypto exchanges. Investigators discovered that proceeds from these illegal transactions were transferred to the bank accounts of Tomar and his family members.
The ED has so far traced Rs 15 crore linked to Tomar and his relatives. During the recent searches, multiple bank accounts belonging to the Tomar family were frozen, including Rs 2.18 crore in deposits.
The agency also uncovered a similar pattern where dubious crypto assets were sold on LocalBitcoins and converted into INR through Indian exchanges. Further investigations into the scam are ongoing.
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