BHOPAL: A Madhya Pradesh district panchayat member from Shajapur, reportedly backed by the ruling BJP, was arrested for allegedly colluding with cyber fraudsters to route money siphoned off through online scams, in a bid to build a financial base for his future Assembly election ambitions.
The Madhya Pradesh Cyber Police’s Gwalior unit arrested 41-year-old Jagdish Malviya, a district panchayat member from Shajapur, and 31-year-old Ankit Verma, a mechanical engineer from Ratlam, in connection with a massive Rs 21.05-crore cryptocurrency investment fraud involving a 70-year-old Gwalior-based chartered accountant, Ashok Vijayvargiya.
According to investigators, Malviya came in contact with Verma, who allegedly arranged bank accounts for cybercrime syndicates to park proceeds of fraud.
Malviya subsequently allowed his bank accounts to be used as first-layer mule accounts and allegedly charged a 2% commission on the money routed through them.
Investigators have so far traced around Rs 2.93 crore deposited into Malviya’s accounts since November 2025. The money was subsequently transferred to second-layer mule accounts, with the trail extending to several states, including Maharashtra and Karnataka.
Of the Rs 21.05 crore allegedly routed through 77 first-layer mule accounts in the case, around Rs 50 lakh was parked in an account held by Malviya before being transferred onward, investigators said.
Sources associated with the investigation said Malviya told investigators that he wanted to accumulate quick money to fulfil his ambition of contesting a Madhya Pradesh Assembly election in the coming years. Verma, meanwhile, allegedly arranged mule accounts to earn money towards his plan of opening a large motor garage.
The case came to light after Vijayvargiya approached the cyber police following what investigators described as a classic “pig-butchering” investment scam. He was allegedly contacted on WhatsApp in December 2025 by a woman identifying herself as “Divya Singh”, who posed as a cryptocurrency investment consultant.
The fraudsters allegedly lured him into Bitcoin and Tether investments through a fake trading platform and displayed fabricated profits to build his confidence. They even transferred Rs 1.88 lakh to his bank account as purported trading returns.
When Vijayvargiya later sought to withdraw his investments, the fraudsters allegedly demanded Rs 10.84 crore as taxes. He subsequently deposited Rs 5.34 crore after being assured that the remaining amount would be arranged. Later, they demanded another 2 lakh USDT, worth more than Rs 1.92 crore, as a supposed “risk margin”.
Realising that he had likely been duped, Vijayvargiya approached the Madhya Pradesh Cyber Police, which registered a case under relevant provisions of the Bharatiya Nyaya Sanhita and the Information Technology Act.
Police said further arrests are likely as investigators trace the wider network and its forward linkages in the cyber fraud.