Ponzi founders caught with their pants down
Amit Bhardwaj and his brother, Vivek Bharadwaj, have been arrested in India for allegedly scamming investors out of $300m, according to Business Insider India.
The pair, who have been linked to crypto scams for a while via hearsay and social media chatter, kicked off an investment scheme in 2013 called GainBitcoin, for both the trading and mining of Bitcoin, promising 10% returns within 18 months.
This is now thought to have been a Ponzi scheme, at least by India’s central bank Reserve Bank of India (RBI), the Enforcement Directorate (ED), and the Cybercrime Cell of Pune Police, the bodies pushing for the arrest of the notorious brothers following an official complaint filed by a businessman Parvendra Singh.
FactorDaily spoke to one of the victims of the scam, named Mayur in the article. Mayur borrowed money from friends and family to invest, and would be celebrating huge returns if he currently held BitCoin and not MCAP coins, which are currently holding less than 20% value compared to the NBTC equivalent.
“If I had just invested in Bitcoins and not GainBitcoin, today I would have made several times the money. MCAP was forced onto us and was not the payout was supposed to be in Bitcoins according to the original contract,” explained Mayur.
According to Business Today, Intelligence sources say Bhardwaj’s suspected links with Pakistanis would also be looked into by authorities. “He was helped in Dubai by people with Pakistani connections. The nature and extent of their involvement is being investigated. But the fact that such a large amount of money was swindled in the form of cryptocurrency to Dubai and that our agencies were able to bring him back is a matter of great satisfaction,” an intelligence official said.
“[W]e are waiting to get our hands on the physical data and after that we would be able to figure out the exact number of bitcoins involved in this case. But we estimate that it could be anything between one lakh to five lakh bitcoins,” added Pankaj Ghode, a consultant with the Pune police.