A Special Investigation Team (SIT) is currently scrutinizing several officers from the Indian Crime Branch, including an Inspector General of Police (IGP), in connection with a Bitcoin scam.
The SIT has summoned Inspector General of Police (IGP) Sandeep Patil, who was heading the Crime Branch at the time, to address discrepancies in the investigation into the Bitcoin scam.
This scam revolves around hacker Srikrishna Ramesh, also known as Sriki, and his associate Robin Khandelwal. Sriki, the mastermind behind the scheme, hacked the cryptocurrency exchange Unocoin in 2017, making off with 60.6 Bitcoins valued at ₹1.14 crore (around $137,000) at the time. He further hacked various online platforms and laundered the funds using cryptocurrency.
Subsequently, Sriki traded 150 Bitcoins worth ₹5.5 crore with Khandelwal. The duo was initially apprehended in 2020 on charges of using Bitcoin to purchase drugs online.
A first information report (FIR) filed by the SIT in January implicates four former Crime Branch officers—Sridhar Poojar, Prashanth Babu, Chandradhar SR, and Lakshmikanthaiah—alongside Santhosh Kumar, a private cyber expert, for illegal confinement, breach of trust by a public servant, and tampering with evidence related to the Bitcoin scam. The accusations include manipulating the investigation to conceal the misappropriation of recovered Bitcoins.
Initially, investigators claimed to have seized 31 Bitcoins worth ₹9 crores from Sriki and 0.08627702 BTC from Khandelwal. However, these Bitcoins were nowhere to be found. The explanation provided was that Sriki had manipulated the Bitcoin core application to mislead the investigation. Nevertheless, the Crime Branch failed to delve deeper into the specifics of this manipulation.
Furthermore, the SIT’s findings reveal that Inspector Chandradhar compelled Khandelwal into custody and coerced him into transferring money from his account to the crypto exchange Wazirx to purchase Bitcoins. Allegedly, this was to compensate for the Bitcoins that the Crime Branch failed to recover from Khandelwal, who had exhausted his cryptocurrency resources.
Additionally, Rishab, the son of an Additional Director General of Police (ADGP), is under investigation for his purported involvement in the scam. He is accused of utilizing illicitly acquired funds from Bitcoin trading. The SIT alleges that he received a ₹40 lakh cheque during Sriki’s active period and used the funds to purchase a car.
This development comes amid a surge in cryptocurrency-related scams in India. Earlier this month, the Enforcement Directorate cracked down on two major scams, seizing over $30 million. Prior to that, the ED collaborated with the FBI to dismantle a $360 million drug trafficking ring facilitated by cryptocurrencies.
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