CBI arrests 5 in HPZ Crypto Currency Token fraud case

The CBI has arrested five individuals in connection with the HPZ Crypto Currency Token fraud case, in which cyber criminals duped victims of hundreds of crores through loan, job, investment, and cryptocurrency schemes, officials said on Saturday.

The agency conducted searches at seven locations in five cities, including Delhi0NCR, Hyderabad, and Bengaluru, leading to the recovery of incriminating digital evidence and financial records, they said.

The agency registered the FIR under provisions of criminal conspiracy, impersonation and fraud and offences under the Information Technology Act, they said.

The case pertains to an elaborate criminal conspiracy orchestrated by foreign-based masterminds in collusion with Indian nationals in which organised cyber frauds were committed across India in the guise of loan, job, investment, and cryptocurrency schemes between 2021 and 2023, a CBI spokesperson said.

''These frauds were facilitated through the creation of multiple shell companies, which were used to open mule bank accounts. The proceeds collected from the victims were routed through these accounts, converted into cryptocurrencies, and subsequently transferred outside India through complex financial layering and crypto conversion routes,'' she said in a statement.

The CBI probe in the case has exposed several shell entities which were incorporated in India at the instance of foreign perpetrators.

''These companies were onboarded on various FinTech and payment aggregator platforms to collect and channel public funds. The funds collected were consolidated, converted into cryptocurrencies, and transferred to various crypto wallets, eventually being remitted across borders to conceal the proceeds of the crime,'' she said.

The five arrested individuals were actively involved in executing the fraud, she said.

Investigation is underway to trace the cross-border financial trails, identify other individuals and entities involved, and unravel the full extent of the conspiracy, officials said.

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