Phone messenger as baits, claims of high return: Rising crypto fraud cases in Pune | Pune News

These are some of the key commonalities that have emerged in over 50 complaints received by the cyber crime police station of Pune city since January this year in which professionals and business persons from high income groups have lost crores of rupees.

FIRs have been registered in 12 cases after the preliminary probe in which the victims have been cheated to the tune of Rs 6 crore.

Initial inquiries in over three dozen remaining cases are currently underway.

These have involve stories of cyber criminals conducting tutorials of victims on how to invest and also stories of people exhausting their savings, taking loans and borrowing money to keep investing in these exchanges which later turn out to be scams.

Take this example.

A software engineer working for a financial services major in Pune and earning a handsome salary, while surfing on crypto investment platform, was contacted by a woman named Elizabeth who claimed she had business experience in the winery sector and is now in cryptocurrency trading. The engineer who had been investing in bitcoins from some time was offered tutorials on crypto trading to earn high profits.

Over a period of 10 days from the beginning of their interaction, the victim ended up investing over 40,600 Tether cryptocurrency (referred to as USDT) equivalent to over Rs 33 lakh in a fake cryptocurrency exchange.

While the exchange website kept reflecting high returns on each of the investments, when he tried withdrawing, it became evident that the exchange did not exist.

Senior Inspector Minal Supe Patil, incharge of Pune City Police’s Cyber Crime Police station says, “There are two broad modus operandi used by Cyber criminals in Cryptocurrency investment frauds. The first one is like any other cyber fraud where criminals directly siphon funds from victims in rupees, claiming they will give high returns. These are not exactly cryptocurrency frauds but investment scams with cryptocurrency used as a cover story.”

“The other type is much more elaborate and involves victims investing cryptocurrency into the fraudulent exchanges. Because having a cryptocurrency wallets requires a level of technical knowhow and investment capacity, almost all the victims of this category are professionals and businesspersons from high income groups — a very large number of them are IT professionals,” the senior inspector added.

Cryptocurrency exchanges also known as digital currency exchanges are businesses that use blockchain technologies to allow customers to trade cryptocurrencies and exchange them with conventional government issued currencies.

Patil added, “The victims, who have shared their contact coordinates on cryptocurrency investment platforms are initially added to Telegram groups with a large member base. The group has users — most of whom use virtual numbers —posting screenshots of how they are earning large returns on investments.”

“ The victims are then made to start investing by transferring cryptocurrency from their wallet to these fraudulent exchanges. These fraud exchanges many times have names very similar to trusted exchanges. In other cases, criminals claim that they have launched new exchanges with the latest blockchain technology and victims blindly trust them. The accounts of these victims keep reflecting high returns on each of the investments made. But in reality the portals of these exchanges are just facades. The frauds come to light when victims try to withdraw their earnings and investments back and realise that their money is gone,” he added.

In another case, 46-year-old senior manager with the Pune office of a software giant lost a whopping Rs 1.12 crore to cyber criminals posing as cryptocurrency investment exchange executives Daniel Cooper and Alexander Hoodhead.

The suspects made him invest Bitcoins cryptocurrency equivalent to Rs 1.12 crore in 13 installments.

For these payments, the victim had emptied Rs 40 lakh from his savings, had taken three loans and even borrowed money from his friends. In the cases registered with Pune police people have lost money ranging from Rs 5 lakh to over Rs one crore.

Speaking about the investigation into these cases, an officer from the Cyber Crime police station said, “By the time the victims approach us the Cyber criminals siphon these cryptocurrency funds to various wallets making it very difficult for us to track them. On the phone messenger groups, suspects use virtual numbers which are difficult to track. The phone messenger companies are many times reluctant to share details. The fake cryptocurrency are most cases operated by international criminals. Our probe into most of these cases suggests that criminals are based in certain African and a few East Asian countries. We are working on some common threads in all these cases in order to crack them.”

Cyber investigators have suggested that the investors should use only the trusted and known cryptocurrency and have stressed that investors specifically do research on the names of these cryptocurrency exchanges and check if they use similar sounding names as that of known platforms.

“We are even advising the people to initially do research on types and modus operandi of frauds in the cryptocurrency investments, before they start putting their money,” said an officer from the cyber police station.