Cyber Crime
Bitcoin Fraud: UP Police Books US-Based Crypto Exchange Poloniex For Defrauding Lucknow Journalist Of Rs 5.66 Lakh
LUCKNOW: Cyber crime police of Uttar Pradesh has booked senior officials of a US-based cryptocurrency exchange – Poloniex, for allegedly cheating a Lucknow based journalist of Bitcoins worth Rs 5.66 lakh.
According to the FIR registered by the cyber crime police station, the victim alleged that the international cryptocurrency exchange – Poloniex, intentionally conspired to misuse his Bitcoins which he had purchased from the platform three years ago. The case has once again highlighted the safety of cryptocurrencies like Bitcoins, the operation of crypto exchanges and governments policy in managing such digital assets.
The victim – Deepak Gidwani in his FIR said that after a reference he bought Bitcoins (BTC) worth Rs 50,000 in 2018. But he never accessed his account because he had very little knowledge about the digital assets. It was only in October 2021, while sorting his documents he found credentials of his Bitcoin purchase with Poloniex.
“I found the login if and password of my account so I thought of checking my balance. I got excited as the money I invested grew almost by 10 times and now I had Rs 5.66 Lakh in my account. When I tried to withdraw the amount I was informed that no transaction can be done as the account is frozen,” Gidwani said in FIT.
ALSO READ: Allure Of Cryptocurrencies Remains Even As Lack Of Regulation Spurs Crypto Crimes
Freezing an account is a standard protocol followed by most companies if the account is dormant. Gidwani was instructed to send his documents for verification and KYC to re-activate his accounts. On November 2, 2021 he wrote to the crypto exchange to start his account and shockingly it was on the same day all the money was illegally withdrawn from his account. But for the next 27 days, Gidwani was not given access to his account.
After following up emails It was on November 29 he got his account back but he was shocked to find that only Rs 1,500 was left in the account. “How can someone access my account when the account was frozen? How can all the money be withdrawn on the same day I contact customer care for re-activation? The account was secured under two factors (2F) authentication then why didn’t receive any notification?,” questioned Gidwani.
The international crypto-exchange Poloniex did not take any responsibility for the breach and blamed an unidentified hacker behind the illegal transaction.
ALSO READ: Morris Coin Fraud: 900 People In Kerala Cheated Of Rs 1,200 Cr In Fake Cryptocurrency Fraud
Apart from registering FIR against the top officials of the company for the fraud, Gidwani has also appealed to the government and RBI to innerve into this international level fraud which is leaving Indian investors helpless.
“I am sure many Indian investors are being cheated by international operators. Most of them do not report these cases as there is very little awareness and due to lack of regulation regarding crypto assets. But, RBI and Central Govt to bring in a new rule which can safeguard Indian investors,” he said.
Prof Triveni Singh, Superintendent of Police, Cyber Crime, Uttar Pradesh confirmed that his team has registered the FIR and started the probe.
“This clearly looks like a case of cheating by the international crypto exchange. On the victim’s complaint, we have booked senior officials of the company along with the CEO. We are now in the process of writing to the company to furnish the account detail of the victim. We will demand logs of his logins and from where the transactions were made,” Singh told The420.in.
ALSO READ: New To Cryptocurrencies? Here Is How To Spot And Stay Safe From Recent Crypto Frauds
He also highlighted that it is a clear breach of security as no one can access an account if it is frozen. Here the victim’s account was frozen and was protected by two-factor authentication still a hackers made the transaction.
The case highlight increasing cases of fraud related to cryptocurrency and with no regulation it because is very difficult to ascertain transaction of Bitcoin.
Follow The420.in on
Telegram | Facebook | Twitter | LinkedIn | Instagram | YouTube