How Odisha Police busted Rs. 1,000 crore cryptocurrency scam
The Odisha Police has reportedly busted a cryptocurrency investment scam worth Rs. 1,000 crore and arrested two suspects, including the head of Solar Techno Alliance (STA) Crypto Token, Gurtej Singh Sidhu. Over 10,000 individuals have lost money in the alleged "Ponzi scheme" in Odisha alone, ANI reported. Victims from Delhi, Jharkhand, and Rajasthan were also scammed into investing in STA Crypto Token.
About STA's modus operandi
The Odisha Police's Economic Offences Wing (EOW) said the accused would lure people from several states to invest in STA Crypto Token by publicizing "fake benefits" through websites and social media. They would then encourage more individuals to invest in cryptocurrencies and gather huge amounts, said EOW Inspector General JN Pankaj. The victims were urged to enroll more persons in the group, he added.
Watch: IG Pankaj giving more details of case
What led to main accused Sidhu's arrest
Pankaj told ANI that the Odisha Police's EOW received the first lead of the crypto fraud from the intelligence wing and that the main accused's movements were regularly watched by Deputy Superintendent of Police (SP) Sasmita Sahoo. He claimed that Sidhu, the mastermind of the fraud, often shifted his location to Goa, Lonavala, Mumbai, Delhi, Faridkot, Bhatinda, Hanumangarh, and Sri Ganganagar.
Ponzi scheme has over 2 lakh members across India
Furthermore, the investigation revealed that STA, through some up-line members, was using propaganda tools to persuade people to join this scheme. It is estimated that over 10,000 people from Odisha are already its members. This Ponzi scheme also has more than two lakh members (across India), mainly in states like Punjab, Rajasthan, Bihar, Jharkhand, Haryana, Delhi, Madhya Pradesh, Maharashtra, Odisha, and Assam.
STA would organize extravagant events to mislead people
Moreover, STA would also mislead members through extravagant celebratory events, where they would give bonuses based on performance. Last week, it reportedly organized a grand celebration in a luxurious star hotel in Goa, which was attended by over 1,000 members. They were promised that if they joined this scheme and recruited new members, they would earn between $20 and $3000 each day.
STA allegedly lacked authorization from RBI, other bodies
Despite all the fanfare, STA allegedly lacked several basic necessities, according to the Odisha Police. They claimed that the organization was not authorized by the Reserve Bank of India (RBI) or any other authority to collect deposits. The police also found that the STA website is hosted in Iceland, but its economic activity is confined to India.
Odisha Police issues advisory against STA
Meanwhile, the EOW has issued an advisory to avoid any further fraud by the STA fraudsters. People are advised not to invest their money in such Ponzi schemes that promise to make them millionaires in an unrealistically short time. It also advised investors and celebrities to invest their money only after checking the credentials of the companies.
Know about Ponzi scheme
A Ponzi scheme is a fraudulent investing plan that promises high rates of return with low risk to investors, according to Investopedia. It is a deceptive investment scheme that creates rewards for early participants by taking money from later ones. This is similar to a pyramid scheme in that both schemes rely on new investors' finances to pay off previous investors.
