KOCHI: Selinamma Joseph (60) of Vazhathoppu in Idukki had never heard about cryptocurrency until last year. Now, she wishes she hadn't. It all began in November 2021 when two persons representing a firm 'dealfxtrade.com' approached her and told her about the huge returns she would get by investing in cryptocurrencies through their trading platform: dealfxtrade.
They told her about a multi-level marketing (MLM) investment scheme that guaranteed 12 per cent returns for new investors she brought in, apart from the 1.6 to 2.5 per cent interest on each US dollar that she invested in the company's different schemes.
Nearly eight months later, Selinamma is yet to receive a single penny as return or the Rs 4.5 lakh that she invested. In fact, thousands of other investors across the state were clueless after the company's website, www.dealfxtrade.com, vanished from the internet without a trace in February.
As it turned out, they were conned. The police swung into action and identified the prime accused as Vinod KK (53), a native of Mudavoor in Muvattupuzha. A team led by Inspector of Police Renjith R booked Vinod on the direction of Perumbavoor ASP Anuj Paliwal and launched a detailed probe into the fraud, the second in state after the 'Morris Coin' scam.
"It was the racket led by Vinod that collected money from people for the MLM scheme. He introduced himself as the chairman of dealfxtrade in the meetings organised to lure investors. The firm is unregistered and lacks mandatory approvals. The racket collected lakhs of rupees from people by simply showing them the website," said a senior police officer.
Crypto: Accused says he too an investor, denies link
Selinamma , who had attended one of the meetings, said after the website disappeared, she tried to reach out to Vinod. "When I went to meet the man who called himself Vinod, I was threatened by some persons. They said the company was registered in the UK and they did not know what had happened to it. I invested my savings in it," she said, adding she had lodged a complaint with the police in Idukki.
The probe revealed that the money was deposited to the accounts of Vinod and his accomplices and not that of the company. “I transferred the money from my account to that of one Nizar who claimed to be Vinod's employee. I have proof of the transaction," she said.
Perumbavoor native Senthil Kumar, who lost Rs 25 lakh, said he too had transferred the money to Vinod's account, not to the company's. "However, several gave cash. Many realised they were duped only a month after the website disappeared," Kumar said. He said the victims would form a collective to approach the state government.
Meanwhile, Vinod moved the High Court for anticipatory bail after the sessions court rejected his plea. In his petition, Vinod denied the allegations. He claimed he was an investor and had no direct link with the company.
He also said he came across the trading platform 'Deal Fx Trade' based in the UK during the course of mining for Bitcoin and, like others, invested money in it. He also said he had only passed on the company's referral codes to some others for investing in it.
Digging deep
The UK government's data website (https://find-and-update.companyinformation. service.gov.uk/) for registered companies does not list not any firm by the name 'dealfxtrade'. An analysis of the domain 'dealfxtrade.com' by an independent cyber expert revealed it was hosted on a server of GoDaddy, a web hosting company. The website was last modified on February 18.
Vinod KK under scanner
Agencies like the Intelligence Bureau and the state's Special Branch have launched a probe to verify the background of prime accused Vinod KK. In his anticipatory bail plea, Vinod claimed to have acquired a deep knowledge in cryptomining and was offering consultancy services to others in cryptocurrency-related investments.
As per the details available with the local police, Vinod moved to Mudavoor in Muvattupuzha a year ago after purchasing land from a local resident and building a house there. His neighbours said they did not know much about him.
"We don't know what he does. He has no connection with the local people," said one of his neighbours. Mudavoor (ward 19) member Mathews Varkey also said he doesn’t know much about Vinod. "He claims to be running a charity organisation," he said.