On 29 August, a police raid in Hyderabad in India saw an arrest of five individuals. All of the prosecuted men associated themselves with the cryptocurrency Ponzi scheme company called Coinx. The worth of stolen funds, according to the police reports, is over $1.4 million from fraudulent trading programs.
Mastermind and Four Associates Arrested
The police action took place in a Secunderabad-based real estate firm, GRM Estates. During the raid, they found phone devices, vehicles, computers, and documents among confiscated assets. The head of the scam scheme, Gardash Ramesh, alongside four others, is facing charges for financial fraud.
Overall, the worth of the legal prosecution totals over $1.4 million, collected from 1.200 investors during the Coinx fundraiser. The plan to take funds unfairly started with an MLM firm, operated by Ramesh to gain trust from potential investors.
Organization of the Coinx’s Ponzi Scheme
As a fake intermediary, MLM would advertise services offered by Coinx, therefore imploring individuals to provide the necessary funding. As proof of conducting business, Ramesh and other suspects convinced interested parties of the false location of head offices. These contracts offered to trade in cryptocurrencies by providing funds to Coinx’s experts. In turn, investors would gain a share in profits, as well as loyalty bonuses, depending on the trade’s success.
Using the USA and the UK as prime bases of operations, Coinx team convinced clients of business genuineness. According to the cryptocurrency Ponzi scheme, in short, Ramesh brought in 12 investment plans, ranging in value from $100 to $500.000.
India’s Continued Crackdown on Crypto Market
Coinx is the latest incident recorded in India, with a government bent on banning the industry completely from its borders. In recent months, regulative bodies forbade banks from engaging in cryptocurrency transactions. As a result, culmination came in the shape of trade ban of all digital assets. It remains to be seen which further steps government officials shall take, especially in the wake of Coinx incident.