NEW DELHI: The Enforcement Directorate (ED) on Monday carried out raids and arrested one of the main accused in connection with an alleged Rs 500-crore cryptocurrency fraud case where they have duped more than 2.48 lakh investors across the country.
The federal probing agency raided premises linked to Vijay Kumar Juneja and Masoom Juneja and arrested the latter under the Prevention of Money Laundering Act (PMLA).
During the searches, investigators recovered incriminating documents and digital devices, according to an official statement.
The agency has registered a money laundering case based on FIRs registered by the police in Himachal Pradesh and Punjab against Subhash Sharma and others.
The ED alleges that Sharma, along with Hem Raj, Sukhdev Thakur, Abhishek Sharma and Radhika Sharma, launched a cryptocurrency-based multi-level marketing (MLM) scheme in 2018 through an online platform designed to attract investors on a massive scale.
Investigators said the operation was initially run through Indian servers before being shifted overseas and operated via domains such as korvio.io and voscrow.com. Investors were allegedly lured into purchasing 'Korvio Coin' (KRO) with promises of assured returns, flashy promotional events and seminars, while token values were manipulated to sustain investor confidence.
According to the ED, the scheme functioned like a classic Ponzi operation, with money collected from fresh investors being used to pay returns to earlier participants. To keep the fraud alive, the accused allegedly introduced new tokens and continued making unrealistic promises of high profits.
The agency claimed that digital records and internet domains connected to the operation were deliberately deleted to destroy evidence. However, recovered data reportedly revealed that more than 2.48 lakh users had invested through the platform and transactions exceeding USD 219 million had been executed.
The ED estimates that investors suffered losses of around Rs 500 crore. The probe further found that proceeds of crime were layered through multiple bank accounts, fictitious entities and intermediaries. A portion of the funds was allegedly converted into cryptocurrency to obscure the money trail.
According to the ED, funds collected from investors were ultimately routed to Vijay Kumar Juneja and Masoom Juneja.
The agency alleged that the duo utilised these funds to acquire immovable properties by significantly undervaluing the registered sale consideration, enabling a substantial part of the transactions to be settled in cash and thereby facilitating the laundering of proceeds generated from the fraudulent scheme.
Statements recorded by the ED from various individuals purportedly indicate that cash was handed over to Vijay Kumar Juneja and Masoom Juneja on behalf of Subhash Sharma and his associates.
Investigators have also alleged that the two acted as nominees in several employee-held bank accounts, suggesting their effective control over these accounts that were allegedly used to layer and conceal the proceeds of crime.
The ED has further claimed that Subhash Sharma fled to Dubai after the alleged fraud came to light in an attempt to evade prosecution. The investigation is ongoing.