A Bitcoin Scam? That too, in India? When did it happen? Are the culprits behind bars now?
Yes, A Bitcoin Scam has happened in India. And no, as of now the culprits are not behind bars as the investigation is still going on. This scam was initiated by a startup scheme called GainBitcoin, whose parent company is a cloud company named GBMiners.
To be precise, even the cloud company got considered as a fraud even before, but still, people were fascinated by the high returns GainBitcoin showcased and invested in them.
Yes, this is an article on one of the biggest Bitcoin scams in India, the GainBitcoin Scam. In this article, we will focus on how the fraud unleashed itself on the citizens of this country, and we will also analyze the progress of the investigation done till today.
A conman named Amit Bhardwaj created GBMiners, and he along with numerous middlemen such as Rupesh Kumar Singh, Akash Sancheti founded this GainBitcoin scheme only for the sake of cheating people.
They convinced people and lured them into joining the GainBitcoin scheme by feeding lies to the people that they will be earning high-level returns in Bitcoin through this scheme. But things started to uncover when numerous incidents happened due to which the investors started to discover the truth of this fraud scheme.
One such incident was of Mr. Dhruv Shera who was assured by Bharadwaj that he would gain returns of 10% for 18 months. Hearing to this, Mr.Shera invested in around 7 BTC in March 2017. But profits started to vanish, as Bitcoin was at its peak in December 2017 and Shera along with other investors could have earned over one crore for the 7 BTC they invested.
But to their dismay, they did not gain even a penny of profit. This step made all the investors realize that they had invested in a fraud scheme which caused them to ask help from the police.
This step paved the way for further investigation from which it got predicted that around 8,000 investors were cheated and had lost their money due to this Ponzi scheme.
The Initiation of Investigation:
Soon after a detailed investigation on this case, the Delhi Police arrested Bhardwaj and eight others who were marked as accused on this case on March 30, 2018. These accused were transferred from Delhi to Pune for further questioning regarding the matter.
It is being reported that Bhardwaj the key accused in the case has assets worth 300 Million U.S Dollars to 5 Billion U.S. Dollars. Bhardwaj has been out on interim bail since April 3. The Supreme Court granted his bond after his advocate showed sufficient proofs of Bharadwaj suffering from a kidney ailment.
The other eight accused which includes his father and two brothers were also granted bail on various grounds infuriating the investors. Among the indicted two of the are the founders of the Darwin Labs Nikunj Jain and Sahil Baghla who acted as the main catalysts in pulling many investors into the scheme.
Though the investigation is being carried out in its own pace, seeing all the accused getting bail on various grounds, the hopes of investors recovering their wealth from these people is getting faded away as each day progresses.
Investors call for CBI probe for this scam:
Many investors have opined that all of Bharadwaj’s wealth should get auctioned and the money obtained from that should get disbursed among the people. This step will compensate for the losses investors had to bear.
The investors have also gone against the decision of Supreme court granting bail to the accused people by hiring a senior lawyer. They have asked for CBI probe into the investigation. The investors also want the interim bail of Bharadwaj to get canceled.
Though interim bail got granted to Amit Bharadwaj, he had to deposit a personal bond of 1 lakh Indian rupees. And after six months he has to deposit ten crore Indian rupees again. His brother Vivek Bharadwaj was commanded to deposit one crore Indian rupees in the next six months.
Are the accused absconding?
Investors have made various claims that Bhardwaj brothers are absconding and are not cooperating with the investigation process. There were lots of advertisements in the newspaper that Bhardwaj and three others were fleeing and were ordered by the court to surrender themselves.
But contrary to the reports, the accused are not absconding. They are signing their presence in the police station every Monday as per the court’s orders.
But still, the investors hear some foul smell, as they believe that only the investigation team can provide them with the right answer. They know that police can get bribed and they do not believe in the words of the police station.
Many investors are expecting that the Pune District Court would soon file charges against the accused persons and help them in recovering their money.
How are the investors holding up in this case?
Many of the investors are experiencing hell in their day-to-day life because of being a part of this scam. Most of them had loaned a massive amount from banks initially to be part of the scheme. But as the project bombarded, they have no other means left to pay back the loan amount to the banks.
Many of their lives have become a tragedy by paying the EMIs for these loans which have taken a toll on their day-to-day living expenses. If this is one case, then there is another case where most of the investors have to pay a considerable amount of fees to hire a senior advocate to fight for their situation.
In such cases, they cannot depend on junior lawyer to help them win the case. But for the sake of paying such amount of fees, they should have money left with them. Most of them have become helpless because of this and are asking for help from outsiders.
Mr.Shera is trying to collect around 15 lakh Indian rupees through this attribute so that they can hire a senior advocate to win them this case.
But frankly speaking, the road ahead to too difficult to cross, and collecting 15 lakh rupees for such cause is nearly impossible. Most of the investors have lost hope due to flaws in the Indian Judicial System, but some of them are still on the belief that justice will get served in due time.
Are the doors open for the investors now?
Just when everything was going to get finished, a new ray of hope started to sprinkle on the investors. The key accused, Amit Bharadwaj, was unable to pay the deposit of 10 crore Indian rupees to the Supreme Court. He was able to pay a sum of 2 crore Indian rupees only.
Though the deadline had finished on October 2, 2018, Bharadwaj was unable to pay even 25% of the deposit amount. This news rejuvenated the investors and brought new hope in them that can still fight for their money.
Because of the failure to pay their deposits on time lead the Enforcement Directorate to take cognizance of his three properties in Dubai which were worth 39 crores. Pune police also recovered 35 Bitcoin and have frozen bank accounts which were belonging to Amit Bhardwaj, his brothers, and the company.
But still, this amount is meager compared to the losses experienced by the investors. So what will be their next step?
Investors write a letter to President Ram Nath Kovind regarding the faulty investigation:
All of the 8,000 investors who had invested in GainBitcoin scheme have written a letter to the President Ram Nath Kovind questioning the investigation pattern of the police over this matter. The investors have also expressed their displeasure over the way the investigation is progressing.
This letter is not the first one to be sent to a person with higher authority in the nation. Similar messages have been sent to the Home Minister, Enforcement Directorate, Ministry of Corporate Affairs and even to the Prime Minister.
The investors have questioned various parts during the investigation process such as the interim bail orders to the accused were not adequately communicated with the stakeholders, nor with the Pune Police or with the Enforcement Directorate and other matters.
The investigators have also questioned how an accused like Bhardwaj be filed only with few charge-sheets when nearly 17 FIRs have got recorded on him across the country. The investors have also reported that the investigation team lacks the expertise to investigate a blockchain-related scam.
But, the bottom line is, did the investors care for their money?
No, perhaps they did not. Because if the investors did, they would have read the terms and conditions before signing on the contract.
According to a report submitted by Juhee Jain to De Montfort University, U.K. it states that nearly 70% of the total investors did not check with the liability of the terms enclosed with the contract. If they had checked with it during the initial days, they would have known that these terms were not legally enforceable.
Most of them got fascinated with the hefty returns the scheme proposed, and most of them just signed due to the insistence from their family and friends. Small negligence at the beginning has cost them a fortune.
So, who is at fault here? The accused or the investors? Both. Yes, both. But the percentages lie heavily on the accused as he cheated on people and showed the stars in the sky where in actual it was just the sand in the road.
Though investors are at fault, it should get seen that most of them were middle-class people who hope for some more money in their life. But leaving all these things behind, will justice be served. Only time can answer that.