Delhi Police bust cyber fraud gang dealing in cryptocurrency, arrest 4 persons; accused transacted Rs 75 lakhs in two days

Delhi Police

Photo : IANS

Delhi: The Cyber Crime Department of Delhi Police said that they have busted an inter-state gang of cyber frauds and arrested four persons who allegedly used to cheat people on the pretext of facilitating online loans.
The gang used to deal in cryptocurrency and learned the tactics from YouTube. They were also in touch with Chinese nationals on telegram, added the police as per a report of news agency ANI.

The arrested accused have been identified as Deepak Patwa (23), Dev Kishan (32), and Suresh Singh (45), both residents of Chittorgarh in Rajasthan, and Sunil Kumar Khatik (34), a resident of Neemuch in Madhya Pradesh.

The matter came to the fore after one Mohd Nadeem Saifi filed a complaint at Cyber Police Station Rohini claiming that he had received a text message on his phone stating “LIGHT your applied loan is approved, you can choose loan limit rangedfrom Rs 2,00,000/-, please login App…”

As per the complainant, he followed the link and fill in the basic details as directed. Then, he received a WhatsApp call from an international number and the caller asked him to deposit 5 percent of the loan amount in advance, citing it as the company’s rule which will be refunded later.

Accordingly, he deposited a total of Rs 40,000 in three transactions. However, after depositing the money, the caller stopped responding on WhatsApp.

Meanwhile, a case has been registered at PS Cyber Rohini and an investigation was initiated by the Delhi Police, reported ANI.

During the investigation and money trail, police learned that the money has been transferred into bank accounts at Neemuch, Madhya Pradesh. On further investigation, police officials learned that more than Rs 75 lakh was transferred into the alleged bank account within two days. The cheated money was used to purchase cryptocurrency on various platforms, added police.

Subsequently, police zeroed in on some suspects and carried out technical surveillance following which it was revealed that they were operating from the Chittorgarh area in Rajasthan.

After this, raids were conducted in Chittorgarh, Rajasthan, and based on technical analysis as well as human intelligence, four accused persons were apprehended by the Delhi Police. The accused persons during the police interrogation revealed their identity and they were then arrested, reported ANI.

Police also recovered 15 ATM cards, seven mobile phones, and 27 SIM cards used in committing the crime. Apart from this, a dongle, laptop, tablet, six chequebooks, one BMW car, five passbooks, and Rs 20,000 were also recovered from their possession.

The arrested accused further disclosed that they got the idea (modus operandi) of cheating from YouTube. They come in touch with some Chinese nationals on telegram who used to cheat gullible people on the pretext of facilitating them loans on the online platform.

Besides, police said that the accused used to get the cheated money in different bank accounts through UPI and then convert it into cryptocurrency by purchasing USDT from duped money on a crypto exchange, as per the ANI report.

Police stated that accused Deepak Patwa used to receive a commission in cryptocurrency and later redeem it into his account through hawala.

Further investigation revealed that the IP address of the alleged WhatsApp number belongs to China. Deepak used to communicate with the Chinese people on his WhatsApp. They used to send his messages in the Chinese language and he took the help of Google Translator to translate the messages into Hindi and further also used to pass his version with help of Google translator, reported ANI.

An investigation into the matter is underway. More victims of the accused persons are being identified.

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How Crypto-Related Phishing Scams Continue To Defraud Investors

On May 29, a resident of Mumbai’s Malabar Hill was duped of Rs 1.53 crore by cyber fraudsters promising good returns on investment in cryptocurrency via a fake website.

Two days prior, on May 27, Charkop police arrested a 23-year-old management graduate for duping investors of Rs 1.5 crore after offering to invest money in cryptocurrency.

Another person in June allegedly lost Rs 50 lakh to a cryptocurrency scam, in addition to other costs such as deposit amount, tax, etc.

Crypto scams are becoming increasingly popular, with all the elements that give an upper hand to scammers — no bank to flag questionable transactions, irreversible transfers, and rookie investors who are typically unaware of how crypto transactions work.

Modus Operandi

To deceive the unwary, scammers develop fake cryptocurrency trading sites or counterfeits of legitimate crypto wallets. These phoney websites frequently have domain names that are similar to, yet different from, the sites they are attempting to imitate. They are similar appearance to authentic websites, making it difficult to distinguish between them, said Rahul Sasi, Founder and CEO, CloudSEK.

CloudSEK also uncovered an ongoing operation involving several phishing domains and Android-based applications. This large-scale campaign lures unwary individuals into a huge gambling scam. Many of these bogus websites impersonate CoinEgg — a legitimate UK-based cryptocurrency trading platform.

“We estimate that threat actors have defrauded victims of up to Rs 1,000 crore via this crypto scams,” said Sasi.

Cryptocurrency investment scams

Fake cryptocurrency websites usually work in one of these ways:

As phishing pages

Phishing attempts using cryptocurrency target crypto wallet private keys — necessary to access funds within the wallet. Scammers send an email to entice victims to visit a specially designed website where they are asked to provide private key information. The bitcoin in those wallets is stolen once the hackers get this information.

As a simple case of theft

What scammers do primarily is let you enjoy a little profit first. Victims are driven to invest additional money since their earlier investments bear good fruit. However, when you subsequently want to withdraw your money, the site either shuts down or declines the request.

Fake apps

One of the most popular ways to trick investors is through fake apps available for download, mostly on Google Play Store. Although these fake apps are quickly found and removed, it doesn’t mean the apps aren’t impacting many bottom lines. People download fake cryptocurrency apps on a daily basis.

Professor Triveni Singh, Superintedent, Cyber Crime, Uttar Pradesh, said unsuspecting investors are always looking for newer options to park their money and scammers are looking for newer investors to defraud. “Fake crypto mining, creating fake wallets, fake exchanges — scammers are inventing newer ways to looting people. Not just this, they also hack an entire valid crypto exchange and poof! your money is gone within seconds,” Singh added.

According to statistics by blockchain surveillance start-up Chainalysis, Indian users have visited various websites operating crypto frauds over millions of times in the past two years.

In 2020, Indians visited crypto scam websites over 17.8 million times. In 2021, the number dropped dramatically, although it was still a significant 9.6 million times.

Coinpayu.com, adbtc.top, hackertyper.net, dualmine.com, and coingain.app are the five most frequented scamming websites frequented by Indians in the last year, according to Chainalysis statistics.

This January, the Enforcement Directorate (ED) seized assets worth Rs 36.72 crore in an alleged fraud in which investors in Kerala were misled into investing in a phoney cryptocurrency dubbed Morris Coin.

Despite their high volatility and ambiguous legal status, Indians continue to be fascinated by cryptocurrency, with a substantial proportion appearing unconcerned about the hazards it carries.

As a method of mitigation, Sasi suggests that in the short term, crypto-related phishing domains should be identified and taken down at the earliest. However, in the long term, it is imperative for the collaboration between crypto exchanges, ISPs, and cybercrime cells to raise awareness and take action against threat groups.

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Cryptocurrency fraud and financial scams are on the rise; tips to avoid falling victim | News

While Cryptocurrency and digital currencies and payment systems have been around for more than a decade, evidence that is now mainstream can be found in the ad mix in this January’s Super Bowl, when you saw, for the first time, ads from digital currency companies like eToro, Crypto.com and FTX, all who ran spots during the game.

Remember the bouncing QR code advertisement that aired in the Super Bowl? That was from Coinbase, a cryptocurrency exchange, who dished out close to $14 million on the ad, which performed so well it temporarily crashed the app.

This rise in popularity, has brought about headlines of fraud.

– A Plano, Texas man, lost more than $220,000 in a cryptocurrency scam.

– A Vegas poker player was charged for his role in a $500,000 Bitcoin trading scam.

The governor of the Bank of England, Andrew Bailey, said cryptocurrency is the new “Opportunity for the downright criminal,” calling cryptocurrency the new “front line” for scams.”

With the Better Business Bureau (BBB) estimating the total value of all bitcoins in the world at $1.03 trillion, the potential for cryptocurrency fraud and risks of financial loss were highlighted last month by a BBB’s International Investigations Initiative, which showed fraudulent activity tripled in the past three years.

The FBI’s Internet Crime Complaint Center (IC3) received 35,229 complaints dealing with victims using cryptocurrency in 2020, with reported losses of $246 million, a 64% increase from 2019 when they reported losses of $159 million.

While most of the fraud activity goes unreported, the BBB received 2,465 complaints in 2021 with losses totaling $7,933,474. Cryptocurrency was found to be used as a new payment method in old scams, such as the fraudulent sale of goods online, advance fee loans and employment.

To protect yourself against cryptocurrency scams, the BBB advises to be on guard of:

  1. Sharing your cryptocurrency wallet
  2. Unfamiliar email addresses and website addresses
  3. Paying with cryptocurrency for products
  4. Fake recovery companies and reviews
  5. Social media celebrity endorsements, claims and “friends”
  6. Crypto apps from unfamiliar sources
  7. Promises of guaranteed returns

For more from the BBB, click here.

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Cryptocurrency fraud ‘exploding’ in Canada, according to consumer advocacy groups

An Alberta woman has another warning about so called “digital gold” and the rush to cash in on cryptocurrency.


B.C. man loses retirement savings to cryptocurrency scam

A Calgary investor — new to cryptocurrency and crypto assets — told Global News she is out roughly $2,500 due to what she believes is fraudulent activity.

“I was being very adventurous and very unprepared for what I was investing in,” Isabelle Lévesque said.

“I trusted them. I can’t believe I got caught.”

Calgary investor warns others after losing $2,500 in crypto investment.

Global Calgary

Lévesque said she found company TrueNorthBit, a cryptocurrency exchange platform, while looking online a few months ago. She reached out and the company was quick to respond. She said she continued to get calls from the company regularly over the next few weeks.

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“They kept insisting on talking to me on the phone,” she said. “They wanted to get to know me better.”

Lévesque said company representatives gained her trust, so she trusted them with her money. Especially, she added, when she started seeing returns.

“The profits just kept growing every day. At one point, just within two weeks, I had made $200 in profit.”

But then Lévesque said she was pressured to invest more — thousands more. She said she was told if she didn’t put in about $10,000 total, she would be transferred to a more junior advisor and would not see the returns she had been seeing.

Read more:

More than $1 million lost to crypto scams this year: Guelph police

She refused and instead decided to start the process of taking all of her money out — with the help, she said, of TrueNorthBit.

“This lady called me and started to direct me to do all kinds of transactions that I didn’t understand,” Lévesque said.

“The balance that night, the balance on my account that I could see online, was zero.”

Read more:

Aylmer man loses $141,000 in cryptocurrency scam: police

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Lévesque sent email after email to the company, which Global News has obtained.

In one them she asks: “What did you do to my account? You didn’t call me back as scheduled on Dec. 24 and my account with TrueNorthBit shows $0. I didn’t receive my money.”

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An email response from the support department at TrueNorthBit reads: “As we can see, you have lost the amount due to trading activities, please check your closed positions for further information.”

Lévesque is adamant she did not trade anything and added she just did what the representative told her to do.

Global News tried to contact TrueNorthBit for a response to her claims. We sent numerous emails directly to the representatives that were in charge of handling Lévesque’s accounts. We also called both the Canadian and UK phone numbers listed on the emails, but we did not get any response.

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BBB warning

The Better Business Bureau Serving Southern Alberta and East Kootenay told Global News it has not received any other complaints about this specific company, but it has received eight other complaints about crypto investing.

“It’s kind of the wild west in the crypto asset market right now,” the BBB’s Wes Lafortune said. “It’s a big problem. It’s exploding.”

Lafortune said the median loss is $600 but he added there has actually been millions of dollars of losses due to cryptocurrency schemes and fraud in Canada.

Lafortune added the regulations around crypto investing are starting to “catch up” but he said real change is still a long way’s off. He suggested investors do their research, get investment advice from someone they trust, and don’t be in a hurry or feel pressured to invest.

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“It’s a bit of the gold rush mentality,” he pointed out. “People want to make a quick buck and there’s promises of huge profit, huge gains and those usually don’t materialize.”

“Bottom line is don’t invest in a crypto asset unless you can afford to lose the money.”

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Alberta Securities Commission alert

The Alberta Securities Commission (ASC) told Global News it is also aware of parties engaging in fraudulent investment schemes, including some in relation to crypto assets/cryptocurrency such as Bitcoin.

It and the Canadian Securities Administrators (CSA) recently issued alerts to investors warning of the dangers.

The ASC said it is focused on educating Albertans about investing, including investing in crypto assets, adding they are very high risk and not suitable for all investors. It has also added a number of resources on its site to help investors check which sites are registered.

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It also strongly encouraged Albertans to ignore unsolicited crypto asset investment offers received online or through social media.

© 2022 Global News, a division of Corus Entertainment Inc.

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