Highlights:
- Shailesh Bhatt arrested for extorting over ₹1,232.5 crore in cryptocurrencies and cash
- ED attaches properties worth ₹442 crore derived from criminal activities
- The case exemplifies India’s stringent enforcement against cryptocurrency-related financial crime
The Enforcement Directorate (ED) of India has apprehended Shailesh Bhatt, a resident of Surat, Gujarat, in connection with an extensive extortion case involving cryptocurrencies. The Enforcement Directorate’s (ED) Ahmedabad Zone conducted an in-depth investigation and was arrested under the Prevention of Money Laundering Act (PMLA), 2002. Bhatt is accused of extorting a staggering 2,091 Bitcoins, 11,000 LiteCoins, and ₹14.5 crores in cash, totaling ₹1,232.5 crores at current exchange rates.
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The Indian Enforcement Directorate (ED) said Bhatt, who had invested in Bitconnect, kidnapped two employees of Kumbhani to recover his funds and extorted 2,091 bitcoins, 11,000 litecoins and cash worth $17 million. He has now been arrested and authorities have seized movable and…
— Wu Blockchain (@WuBlockchain) August 18, 2024
Shailesh Bhatt’s Extreme Measures for Recovery
The ED’s investigation into Shailesh Bhatt’s activities stems from two cheating cases filed by the Surat CID (Crime) against Satish Kumbhani. The promoter of Bitconnect Coin. Kumbhani allegedly lured investors into the Bitconnect Coin scheme during 2017-18, promising substantial returns.
However, the scheme abruptly collapsed, and its promoter, Satish Kumbhani, disappeared without a trace. This left investors, including Bhatt, who had heavily invested in Bitconnect, facing huge losses. Motivated by the financial damage, Bhatt took drastic action to recover his lost funds.
According to the ED, Bhatt resorted to extreme measures by kidnapping two employees of Kumbhani. Consequently, under duress, he extorted considerable cryptocurrency and cash from them. Specifically, the extorted assets included 2,091 Bitcoins, 11,000 LiteCoins, and ₹14.5 crore in cash. All are now estimated to be worth ₹1,232.5 crore.
ED Seizes Assets in Extortion Case
The ED’s investigation revealed that the proceeds of the extortion were not solely for Bhatt’s benefit. Investigators discovered that he distributed ₹289 crore of the proceeds to his accomplices who actively participated in the kidnapping and extortion. They then used these funds to purchase various assets, including immovable properties and gold.
In a significant development, the ED has attached movable and immovable properties linked to Bhatt, valued at ₹442 crore. This includes properties, gold, and other assets as part of the ongoing efforts to recover the extorted funds. Additionally, the ED continues to investigate the flow of money and the network of individuals involved in this scheme.
Bhatt’s Arrest and Legal Implications
Shailesh Bhatt’s arrest marks a critical point in the investigation. The ED’s statement emphasizes that Bhatt acted to recover his investment in the now-defunct Bitconnect Coin. Consequently, his decision to take the law into his own hands led to the extortion of substantial assets, resulting in severe legal consequences.
The Enforcement Directorate’s (ED) arrest of Shailesh Bhatt for extorting cryptocurrencies and cash valued at over ₹1,232.5 crore. This underscores India’s stringent enforcement measures against financial crimes, especially in the volatile cryptocurrency sector. This action reflects the government’s commitment to maintaining financial stability and protecting investors from fraudulent schemes.
This action, including the seizure of assets valued at ₹442 crore, is a stark warning against illegal activities in unregulated markets like Bitconnect Coin’s. The case emphasizes the repercussions of such actions. It signals the ongoing vigilance of Indian authorities in regulating and policing the digital asset space, setting a precedent for future legal and regulatory measures.
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