Kochi: The Law Enforcement (ED) Directorate arrested another person in connection with a massive cryptocurrency fraud in which 900 people were defrauded of a massive amount of Rs 1,200 crores.
According to available information, ED officials from the Kozhikode sub-zonal office on Thursday arrested Abdul Gafoor, director of Stox Global Brokers Private Limited, in connection with the case.
He was arrested while investigating a money laundering case against a man named Nishad K, who ran an agency named “Morris Coin Crypto Currency”. Nishad, the main defendant in the case, and others deceived more than 900 investors in the amount of Rs 1,200 crore. By claiming that they are related to people who make money through cryptocurrency, scammers force people to invest money for big profits. Abdul Gafoor actively facilitated the filtration of crime proceeds through various entities. An amount of Rs 39 crores was transferred through Stox Global Brokers Private Limited. Abdul Gafoor is in the custody of the PMLA Special Court and ED’s request for dismissal will be heard on Monday. Earlier, ED tied up Noushad’s assets worth Rs 36 crores under the PMLA and arrested seven others.
Losing money after investing in cryptocurrency has become a common occurrence in the state of Kerala as many come out every day to file such complaints. Tempted by fake promises from fake agencies, people invest in cryptocurrencies hoping big profits will lose money.
“In India, we have no law for safe and secure cryptocurrency investments or any agency that will monitor cryptocurrency transactions and its market. However, cryptocurrency transactions are not legally prohibited. People can invest at their own risk. Investing in cryptocurrency requires some technical knowledge, which the average person does not have, ”said George Joseph, a financial expert.
According to Investopedia, cryptocurrencies are digital or virtual currencies supported by cryptographic systems. They allow secure online payments without recourse to third-party intermediaries. “Crypto” refers to various encryption algorithms and cryptographic techniques that protect these inputs, such as elliptic curve encryption, public-private key pairs, and hash functions.
“Cryptocurrencies are digital assets secured through an online mining process based on blockchain technology and large -scale algorithms. Cryptocurrencies cannot be converted to Indian currency but can be transferred to potential buyers for cash or other assets. Even at the international level, there is no proper mechanism available to monitor it and this poses a major threat to the existing financial systems. Cryptocurrencies are widely used by international agencies for drug and arms deals because it is easier for them to circumvent legal frameworks, ”he added.
With the ignorance of the people, various agents and agencies directly approach the people to convince them of their connections with the people and agents in foreign countries who deal in cryptocurrencies. “These agencies are not recognized by the laws of India or approved by the RBI or the government of India. Investors here may not get income due to fluctuations in its market value or other factors, “added George Joseph.
He also advised the public not to invest in cryptocurrency as there is no collateral for the money deposited by a person. “Only go if it has the support of an authorized mechanism,” he added.
According to Union Budget 2022-23, cryptocurrency revenue will be taxed by 30% from fiscal year 2022-23. “It doesn’t mean cryptocurrencies are legally allowed here because we don’t have the right laws for it,” George Joseph said.
Currently, only a few countries accept cryptocurrencies, but nearly a hundred countries have taken steps to develop guidelines to legalize them.