The Head of BitConnect India, Divyesh Darji, has been arrested in connection with a bitcoin investment scam.
Indian CID swooped shortly after Darji arrived at Delhi airport from Dubai, with Inspector PG Narwade of the Criminal Investigation Department of Gujarat police commenting that “Darji was living in Dubai. A look-out circular was issued against him. The Immigration Department alerted us when he was on the way from Dubai to Ahmedabad, after which he was arrested today evening.”
The BitConnect platform was shut down in January of this year after being called out as a Ponzi scheme amid reports that it failed to pass regulatory scrutiny.
With a previous value as high as $509 in December 2017, the value of BitConnect dropped to as low as $7.
Narwade continued –
“The company came into existence in 2016, and in 2017, it launched the BitConnect coin. It remained active till January this year. It released 2.80 crore coins, out of which 1.80 crore coins were sold to investors.”
“The accused held seminars, events in India and other countries promising high interest – daily interest rate of 1 percent – on investment in BitConnect coins. The cost of one BitConnect coin on January 16, 2018, when the company shut down, was USD 362.”
The CID has claimed that employees of the of BitConnect’s Surat office have admitted to them that promoters, including Darji, received “crores of rupees from thousands of investors.”
Attempts at extortion
In what can only be described as a rather strange turn of events, the whole bitcoin investment scam only came to light when Surat-based builder Shailesh Bhatt was arrested for apparently attempting to extort cryptocurrency and a sum of cash worth over Rs 155 Crore from two men who worked for another of the promoters at BitConnect.
Bhatt had seemingly invested in BitConnect as well and was among those who lost money when the company was wound up, and upon his arrest, the spotlight was put firmly on the other BitConnect owners, and the bitcoin investment scam was revealed.
Upon closing the exchange, the owners went missing and could not be traced, meaning investors lost a lot of money.
The arrest of Divyesh Darji is the first step in authorities bringing those responsible to justice.
Lover of all things crypto, blockchain and AI, professional tech scribe & part of the editorial team at Crypto Disrupt.