Crypto Mining 'App' Scam: ED Files Charge-Sheet Against 299 Entities, Including Chinese Nationals

Among the accused are 76 entities controlled by Chinese nationals, with 10 directors being of Chinese origin, along with two entities controlled by other foreign nationals

The ED revealed that a special court in Dimapur acknowledged the prosecution complaint filed under the PMLA on Tuesday.

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The Enforcement Directorate (ED) has initiated legal action against 299 entities, including 10 individuals of Chinese origin, under anti-money laundering laws. This move comes in connection with an investigation into an alleged cryptocurrency scam targeting investors. The ED revealed that a special court in Dimapur, Nagaland, acknowledged the prosecution complaint filed under the Prevention of Money Laundering Act (PMLA) on Tuesday. Among the accused are 76 entities controlled by Chinese nationals, with 10 directors being of Chinese origin, along with two entities controlled by other foreign nationals.

The Enforcement Directorate (ED) has filed a prosecution complaint against 299 accused persons and entities (including 76 Chinese-controlled entities) and two other entities controlled by other foreign nationals in an ongoing money laundering case in relation with duping of… pic.twitter.com/5F4je4kcPW

— ANI (@ANI) March 6, 2024

The origins of the ED's case trace back to an FIR filed by the Cyber Crimes Unit of the Kohima Police. This FIR implicated various individuals for deceiving unsuspecting investors with promises of extraordinary returns through cryptocurrency mining, particularly involving Bitcoins.

According to police reports, the accused utilised a mobile application named "HPZ Token" to defraud investors. The ED further elaborated that bank accounts and merchant IDs were established by shell entities with dummy directors to facilitate the laundering of illicit proceeds.

These funds, allegedly obtained through fraudulent means, were purportedly directed towards illegal online gaming, betting, and investments in Bitcoin mining schemes. The modus operandi involved promising investors returns of Rs 4,000 per day for three months against an investment of Rs 57,000. However, after an initial payout, investors were coerced into providing additional funds.

As part of the investigation, the ED conducted nationwide searches, leading to the seizure of assets and deposits totaling Rs 455 crore. These seizures underscore the magnitude of the alleged financial malfeasance. The unfolding of this case underscores the growing concerns surrounding cryptocurrency scams and the imperative for stringent regulatory measures to safeguard investors' interests.