ED files charges against Chinese-origin directors, others in crypto-mining app case

299 entities, including 10 individuals of Chinese origin, have been charged under the anti-money laundering law in an investigation into allegedly defrauding investors in the name of mining cryptocurrencies such as bitcoin, the Enforcement Directorate said on Wednesday.

A special court at Dimapur in Nagaland on Tuesday took cognizance of the prosecution’s complaint filed under the Prevention of Money Laundering Act (PMLA), the federal agency said in a statement.

A total of 299 enterprises, including 76 Chinese-controlled enterprises in which 10 directors are of Chinese origin and two controlled by other foreign nationals, have been named as defendants, it said.

The Enforcement Directorate (ED) money laundering case stems from an FIR of the Cyber ​​Crime Unit of the Kohima Police.

The Kohima police have arrested various people under the Indian Penal Code and the Information Technology Act for allegedly duping gullible investors by promising astronomical returns by mining Bitcoin and other cryptocurrencies.

Police said an application (mobile phone application) with the name ‘HPZ Token’ was used by the accused to ‘cheat’ investors.

The ED said bank accounts and trader IDs were found from various “fictitious entities” having “bogus” directors with the aim of “layering” the proceeds of crime.

These funds were “fraudulently” obtained for illegal online gaming, betting and bitcoin mining investments, he alleged.

For an investment of Rs. 57,000, returning Rs. 4,000 per day for three months was promised but the money was paid only once and then the accused were sought fresh funds from the investors, the ED said.

In this case, the ED conducted nationwide searches which led to the seizure of immovable assets and deposits worth Rs. 455 crore, he said.