ED sleuths nab kin of bitcoin marketing scheme promoter

MUMBAI: The Enforcement Directorate (ED) on Sunday arrested Simpy Bhardwaj, a relative of a deceased Pune-based businessman who was accused of running a Rs 20,000-crore multi-level marketing scam involving bitcoin investments.

The ED arrested Simpy from Delhi and alleged she was actively involved in a crypto currency fraud committed by her husband Ajay Bhardwaj and Ajay's brother, the late Amit Bhardwaj, along with others. The main allegation against the trio is that they lured investors by promising high returns on their bitcoin business. Since Amit's death, investigators have focused on locating data stored on his personal devices, which were presumed to hold crypto currency wallets. However, there is no trace of them so far.

The ED produced Simpy before a court in Mumbai on Monday. The court remanded her into ED custody till December 26. The ED has also accused Simpy of creating a "ruckus" during the search on Sunday and helping Ajay Bhardwaj and her father-in-law escape.

ED alleged that a company, Variabletech Pte Ltd, was registered in Singapore to seek investments in bitcoins. In its remand application, the ED said, "Simpy Bhardwaj along with directors of Variabletech Pte Ltd, Amit Bhardwaj and Ajay Bhardwaj, hatched a criminal conspiracy in connivance with other accused persons to cheat the general public at large through its website www.gainbitcoin.com. It was projected by Simpy Bhardwaj and directors of Variabletech Private Limited, Singapore that this company is involved in block chain and cryptocurrency mining technology and has a mining farm in China and the company, through its cloud mining service provider (Gainbitcoin) acquires cloud mining hash power from large vendors by paying them in form of Bitcoins."

ED alleged that Simpy and the directors offered investors cloud mining space for 18 months through a contract in exchange for assured returns of 10% per bitcoin for 18 months. As per the scheme, investors could buy bitcoins from any crypto currency exchange or from Bitex.com, a crypto currency exchange owned and controlled by Simpy Bhardwaj and others running Variabletech. The accused had a team of marketing personnel across India, who helped to tap a vast pool of investors.

After the crackdown began, Amit's kin claimed that gadgets belonging to him which contained crypto wallet details had been stolen following his death. They said they were unaware where he had stored the funds collected in the form of bitcoins. In the last four years, police and ED teams have found no trace of the money.