Indian Enforcement Directorate (ED) has conducted searches that uncovered a Ponzi scheme involving crypto operations and HR Crypto Coin, leading to significant asset seizures and freezing.
The coins were part of the scheme, luring people to invest with promises of a 15% annual interest rate and offering 30% direct referral income for introducing new customers.
ED Cracks Down On Highrich Online And HR Crypto Coin
India’s Enforcement Directorate (ED) announced on Friday that the Kochi Zonal Office executed search operations on June 11 at 14 locations in Kerala, Maharashtra, and Chhattisgarh.
These actions targeted the premises of promoters and leaders of the Highrich Online Group under the Prevention of Money Laundering Act (PMLA), 2002.
The ED revealed that the searches uncovered the involvement of the company, its promoters, and leaders in cryptocurrency trading on several exchanges, along with selling their own digital currency, HR Crypto Coin. The Indian authority explained:
“The HR Crypto Coin was sold in exchange for INR and USDT. The HR Crypto Coins were also a part of Ponzi scheme where people were lured to invest their money for which they will get 15% interest p.a. and when the customer introduces a new customer, they will get 30% direct referral income.”
The ED’s investigation stemmed from the first information report (FIR) filed by the Kerala Police and numerous complaints against Highrich Group and its directors.
The company was found to be selling memberships as digital IDs, which provided user credentials to access their website for a fee.
Members then sold these memberships to others to earn commissions, with extra incentives for referring new members. This scheme, with no real underlying business, was identified as a classic Ponzi scheme.
The raids resulted in the freezing of approximately Rs. 32 crore ($3.9 million) in various bank accounts associated with the company, its promoters, and their families.
Additionally, authorities seized around Rs. 70 lakh ($85,365) in cash, jewelry, and four vehicles. The searches also revealed immovable properties worth Rs. 15 crore, acquired through illicit funds.
In January, the ED also conducted searches at the premises of Highrich Smartech Pvt. Ltd., Highrich Online Shoppe Pvt. Ltd., and related entities.
These operations uncovered Rs. 212 crore in illicit funds, which were subsequently frozen under the PMLA. To date, the total proceeds of crime seized or frozen amount to Rs. 260 crore, including immovable property documents.
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