NEW DELHI: The Enforcement Directorate has informed the Supreme Court that while probing a money laundering case involving 80,000 Bitcoins, it found a well-planned conspiracy hatched by a Singapore-based firm owned by Indians who have footprints in United Arab Emirates and China.
Appearing for the ED, additional solicitor general Aishwarya Bhati informed a bench of Justices D Y Chandrachud and Surya Kant that Singapore-based Variabletech Pvt Ltd and its director Amit Bhardwaj, along with brothers Ajay and Vivek, and also their father Mahendra, had projected that their firm is “involved in block chain and cryptocurrency mining technology and has a mining firm in China and the company through its cloud mining service provider gainbitcoin.com acquires cloud-mining hash power from large vendors by paying them with Bitcoins”.
Side-stepping the bench’s query during the last hearing about the status of Bitcoin in India, Bhati said that the status of cryptocurrency is not required to be adjudicated in this case, as it was purely a case of cheating and money laundering. The firm and the Bhardwajs projected that the general public could purchase a small part of the cloud mining space (hash value) for 18 months through a contract made with Variabletech and can get an assured return of 10% per Bitcoin.
The Bhardwajs and their associates collected 80,000 Bitcoins as ‘proceeds of crime’ and because of their non-cooperation the probe is not proceeding further, the ED said in its status report. Since the cryptocurrencies bypass the normal banking route, and are transferred from one cryptocurrency wallet to another, it is necessary for the accused to provide passwords to the investigators, the agency said.
“During the course of the investigation, the statement of Aditi Bhardwaj, one of the multi-level marketing (MLM) agent was recorded wherein she stated that petitioner Ajay Bhardwaj had travelled with her and other MLM agents to China during their visit to the Bitcoin mining farm situated in China,” the ED said.
“Ajay Bhardwaj had stated that he was not aware of any company AB Research and Consultancy, Dubai. But when confronted with documents, he admitted to being a director of the Dubai-based firm… From the bank statements, it was found that AB Research and Consultancy had received UAE Dirham 3,83,744 from Sheffield Holdings in lieu of advisory services,” ED said and accused Bhardwaj of giving contradictory statements.
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