Himachal Pradesh: A group of fraudulent individuals working in the state of Himachal Pradesh implemented a deceptive plan that deceived a large number of investors, resulting in the accumulation of a substantial amount exceeding Rs 200 crore in Crypto Scam within a period of five years, commencing with the cryptocurrency boom in 2018. The fraudulent activities encompassed two principal cryptocurrencies, namely KRO and DGT, which were utilized to entice naïve users by offering significant returns within a limited period.
Pretending to Be Profitable Investments
The individuals orchestrating the fraudulent scheme initiated their activities by launching a digital currency known as ‘Korvio Coin’ or KRO coin. They enticed prospective investors with the allure of substantial profits and subsequently solicited an activation fee. This marked the commencement of their meticulously devised Ponzi-style scheme, wherein they enticed initial investors to recruit further participants, so establishing a cyclical pattern where fresh investments were utilized to compensate previous investors, thus providing an illusion of profitability.
A Network of Deceit and Exploitation
The perpetrators exerted significant efforts to retain authority over their fraudulent scheme. The individuals employed tactics such as disseminating false information, engaging in deceptive practices, and employing coercive measures to influence the value of cryptocurrencies, while also fabricating online platforms to promote their own digital currencies. Following this, the introduction of ‘DGT Coin’ resulted in an initial increase in price followed by a sudden and substantial decline, leading to considerable financial losses for numerous individuals.
Lawmakers Take Notice
The issue drew the interest of Independent MLA Hoshyar Singh, who approximated the magnitude of the fraud to exceed Rs 200 crore specifically in the districts of Kangra and Hamirpur. After the individual raised the matter in the Vidhan Sabha, a Special Investigation Team (SIT) was promptly formed to investigate the fraudulent activities.
Police Crackdown and Ongoing Investigations
According to Deputy Inspector General of Police, Abhishek Dhullar, the Special Investigation Team (SIT) has assumed control of the situation. Dhullar emphasized that although five men have been apprehended, the orchestrator of this operation is still evading capture. The ongoing inquiry aims to determine the exact sum of money fraudulently obtained from naïve investors.
According to the Director General of Police Sanjay Kundu, significant progress has been made in the pursuit of apprehending the masterminds behind cryptocurrency fraud in Himachal Pradesh. The authorities have successfully identified and documented their assets, while concurrently carrying out a comprehensive financial investigation.
An Alert to the Public
The public is being advised by authorities to exercise caution and avoid becoming victims of Bitcoin fraudsters. The bitcoin market has experienced several instances of rug-pull schemes in recent years, underscoring the importance of exercising caution and conducting comprehensive research before making investments in any cryptocurrency endeavor.
This year, the police have received a total of 50 complaints pertaining to fraudulent activities. As a result, there has been an escalation in attempts to apprehend and prosecute the individuals accountable for these offenses. By means of ongoing investigations and heightened public awareness, the authorities endeavor to mitigate these deceptive practices and safeguard prospective investors from becoming victims of comparable fraudulent schemes.
In the midst of an escalating quest for justice, Himachal Pradesh maintains a state of heightened awareness in order to combat the grip of cryptocurrency fraud, with a steadfast commitment to safeguarding its populace from potential financial exploitation.
Korvio Coin (KRO):
- Initial Activation Fee: The perpetrators developed a cryptocurrency called ‘Korvio Coin’ and lured potential investors by making enticing claims of substantial financial gains. Investors seeking to participate were subjected to an activation fee.
- The promise of Substantial Returns: Investors were enticed by enticing assurances of significant profits on their investments, relying on the heightened enthusiasm surrounding cryptocurrencies.
- Ponzi-Style Strategy: By employing a Ponzi scheme methodology, initial investors were incentivized to recruit additional persons, thereby establishing a recurring pattern in which fresh investments were utilized to provide returns to earlier participants, thereby generating an illusion of profitability.
- Fake Websites and Misinformation: In order to exert authority over their fraudulent operation, the perpetrators devised counterfeit online platforms, manipulated the values of digital currencies, and propagated false information with the intention of deceiving and enticing further individuals to invest.
- Price Manipulation: The individuals engaged in fraudulent activities by introducing a cryptocurrency called ‘DGT Coin’ and subsequently manipulated its value, so luring potential investors to acquire it.
- Abrupt Price Drop (Rugpull): Following a considerable influx of individuals who made investments, a purposeful and sudden reduction in price was orchestrated, resulting in enormous financial losses incurred by these investors.
- A Repeat of Ponzi Tactics: The new coin adhered to a comparable structure, wherein it incentivized initial investors to attract further participants, hence perpetuating the utilization of Ponzi scheme strategies.
The utilization of these strategies in conjunction with cryptocurrencies (KRO and DGT) enabled fraudulent individuals to manipulate unaware investors, leading to substantial monetary deficits for numerous individuals.
About The Author:
Yogesh Naager is a content marketer who specializes in the cybersecurity and B2B space. Besides writing for the News4Hackers blog, he’s also written for brands including CollegeDunia, Utsav Fashion, and NASSCOM. Naager entered the field of content in an unusual way. He began his career as an insurance sales executive, where he developed an interest in simplifying difficult concepts. He also combines this interest with a love of narrative, which makes him a good writer in the cybersecurity field. In the bottom line, he frequently writes for Craw Security.
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