Pune Police Move to Court Seeking the $1.1 million Recovered in a Ponzi Scheme


The Pune city police have sought a court directive to enable them to transfer the Rs8.2 crore ($1.1 million USD) which they had previously converted into Indian National Rupee (INR).

Times of India reported on 3rd October that the conversion was done from the 244.0925 crypto units the police had seized from the accused in the Gain Bitcoin cryptocurrency Ponzi scheme, last year.

The Gainbitcoin Ponzi scheme

Four individuals were arrested in connection to the Ponzi scheme. Amit Bhardwaj, Vivek Amit’s brother, Hemant Bhope and Pankaj Adlakha were accused of allegedly conning an investor about $1.4 million worth of cryptocurrency. Amit is thought to be the mastermind of the fraudulent scheme.

Traders were lured to gain bitcoin by the lucrative investment deals the four offered with potentially high returns. They claimed that the scheme would earn its profits from both mining and crypto trading. The prosecution was able to make a case against the accused with 15 petitioners and 27 witnesses. 

The individuals faced different charges. Vivek Bhardwaj was charged with conspiracy to steal from unknowing investors. His brother Amit was accused as the mastermind of the whole scheme while the other two, Hemant and Pankaj, face charges of promoting a fraudulent scheme.

Discidium Accounts frozen

The city police cybercrime unit hired the Discidium Internet Labs Private Limited (also known as Koinex) for the conversion of the seized cryptocurrency into the Indian National Rupees (INR). The money is thus at the Discidium Internet’s account in the Central Bank of India, the Worli branch.

In the pleas made by Jairam Paygude, the cyber police senior inspector, the central bank of India was unable to transfer the money into the Bank of India treasury branch in Pune. This was due to the freezing of the Discidium Internet account by the Reserve Bank of India (RBI). Petitions were filed on 20th April 2018 to challenge the validity of the Reserve Bank of India’s circular that prohibited virtual currencies dealings.

Petition Filed to Unfreeze Discidium Account

Discidium Internet is one of the petitioners who also filed an interlocutory before the Supreme Court. The appeal was so that the Reserve Bank of India (RBI) could instruct the central bank to unfreeze their accounts.

Ujjwala Pawar, the district government pleader, said that the plea made by the police is pending before the session’s court. The Reserve Bank of India, on the other hand, has written its reply to the notice by the court made on 17th September to the manager of payments settlement systems in Mumbai, Praneeth Pinjaria.

In its reply on 20th September, the Reserve Bank of India (RBI) stated that they had not frozen Discidium Internet accounts. They further stated that they had not instructed the central bank to freeze the said account.

Anna Larsen
Anna Larsen has been a Crypto enthusiast since 2016. Fascinated by the technology and its usecases she decided to pursue a career in content creation related to this space. The journey has been exciting ever since.

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