In the cradle of Dev Bhumi, between the majestic Himalayan ranges and sprawling tea estates, a massive cryptocurrency scam flourished unchecked for nearly four years, before a recent mention in the Himachal Pradesh Assembly by an Independent MLA sent security agencies scrambling to investigate the Rs 1,740-crore fraud. A nearly two-month-long investigation by a Special Investigation Team (SIT) reveals how the scam, which flourished from 2018 to 2022, allegedly involved a mastermind and his agents — many of them retired security and police personnel who opted for early retirement to work as “team leaders”. Investigators said an estimated 2.5 lakh people fell for the promise of “11 per cent returns” on investing in bogus cryptocurrencies named Korvio Coin (KRO) in 2018 and DGT Coin in 2020. Based on the 350 complaints received on a dedicated helpline launched this year on October 19, most victims are residents of Kangra, Mandi, Hamirpur and Una districts of Himachal Pradesh, and had ‘invested’ the money they got as compensation from the government for acquiring their lands for various road projects. A few ‘investors’ are from Phagwara in Punjab. Deputy Inspector General (DIG) of police, Northern Range, Dharamshala, Abhishek Dular, who heads the 12-member SIT, said, “It was a masterstroke by the main accused to engage agents who would be blindly trusted by the public — retired Army officers, locals workers of political parties, police personnel and retired government employees — to promote these fake cryptocurrencies. These people were lured to work for the accused for profits and position of team leaders. Initial returns were so good that nearly 1,000 state police personnel opted for the department’s voluntary retirement scheme (VRS) to become team leaders.” An SIT officer said, “Excluding the kingpin, there are three main categories of people involved in the scam. The first, those who earned the most. The second, team leaders who worked on the ground to get investors. The third, the victims.” Stating that 19 suspects, including three police personnel, have been arrested as of November 8, Dular said they have been charged under the stringent Banning of Unregulated Deposit Schemes (BUDS) Act, 2019, which allows seizure of their movable and immovable assets. The police said this is the first case under BUDS Act in the state. Kingpin on the run SIT has identified the alleged kingpin as Subhash Sharma, 42, a resident of Mandi district, who worked with multiple private firms before conceiving the scam. He was allegedly involved in multi-level marketing (MLM) schemes at some of these companies. Himachal Pradesh Police believe Subhash fled to Dubai in May. Sources said that as the fraud began to come to light, Subhash convened a meeting of disgruntled investors in Delhi on December 4, 2022, to assure them that their investment would be returned to them by May. Instead, he left his wife and two children at her parental house in Mandi and fled. Investigators said some of Subhash’s co-accused, including Hemraj Thakur and Sukdev Thakur, belong to Mandi district too. On the recent arrests, an SIT member said, “Hemraj, Sukhdev, Paras Ram Saini and Gobind Goswami worked directly under Subhash. While Sukhdev and Hemraj were arrested from Gujarat on October 3, the others were arrested from Himachal, Panchkula (Haryana) and Zirakpur (Punjab).” Sukhdev, investigators said, would introduce himself as someone who had won the ‘Nelson Mandela Nobel Peace Award’ in 2021. Besides coverage by local papers, he was felicitated, including by a former MLA, at an event organised by the fraudsters. As part of the scam, the SIT member said, Subhash would organise corporate-style motivational seminars in Himachal Pradesh, Chandigarh, Goa and Bengaluru. At these lavish meets, investors — both hired and genuine — would dazzle the audience with their rags-to-riches story and claim they had quit their jobs to become full-time investors. Subhash and his aides spent nearly Rs 4 crore to send their “best team leaders” on about 2,000 leisure trips to Dubai between 2018 and 2022 to “motivate” other agents, investigators said. Sanjay Kumar, 49, a former Armyman and resident of Kangra district’s Karana village, is among the victims of the scam. “Two political activists and a uniformed constable approached me to invest in June 2021. Though I have forgotten the policeman’s name now, I remember that he was very vocal about the profits he had made. He also told me that he would opt for VRS soon to become a full-time investor. I thought if a policeman is endorsing the scheme, it should be safe,” he said. Sanjay says he gave Rs 37,500 to one of the men, who downloaded an app on his smartphone, issued him a digital ID and created a digital ‘Korvio Wallet’ for him. While each of the 2.5 lakh investors were given ‘digital IDs’, those who invested in the names of their relatives were issued 80,000 ‘unique IDs’, the probe has revealed. “For six months, I received weekly returns. When I sold 10 of my 100 KRO Coins, I got Rs 25,000 in cash. Encouraged, I invested almost Rs 4.50 lakh in the names of my wife, brother and brother-in-law. They were issued unique IDs linked to my digital ID. All that money is gone now,” he rued. Ranjeet Gularia, a resident of Kangra’s suburban Dehra who lost nearly Rs 2.80 lakh to the fraud, said, “We fell for the false promises because we were not approached by strangers. (Retired constable) Sunil Kumar Syal, and (local political activists) Dinesh Kumar and Vipin Kumar visited our area frequently to convince us to invest.” Investigators said Sunil was with Hamirpur district’s Cyber Cell before he opted for VRS in 2020. In Hamirpur, he allegedly convinced many retired police personnel and government teachers to invest in the scheme. Sunil was arrested by the Punjab Police on October 10 from Zirakpur in connection with another cryptocurrency scam. Dinesh and Vipin are currently on the run. How the scam stayed under the radar DIG Dular, who has investigated cases of financial fraud during his stint with the CBI, said, “The fraud started gaining popularity in 2019 since it was easy money after a one-time deposit. The scammers also claimed that cryptocurrency would only be traded in dollars. The accused would fix the price of a digital coin — from the initial face value of nearly Rs 70 each, their face value went up to between Rs 800 and Rs 4,000. Funds from new investors ensured that old investors kept making money. That’s why the scam ran unchecked for years.” A senior police officer said the accused also exploited the lacunae on cryptocurrency and the changing guidelines to keep the scam going. The officer said, “In April 2018, the Reserve Bank of India (RBI) prohibited regulated entities from dealing in cryptocurrencies. So investors received their returns in cash without receipts, save for a digital ID. In 2020, the Supreme Court revoked this order. The court’s decision was used by the accused to claim that their business was now legitimate. It helped them immensely when reports claimed that cryptocurrency would be brought under the ambit of income tax in the 2022 Budget.” DIG Dular said, “Sukhdev made Rs 200 crore from the scam, while Hemraj, Paras and Gobind earned Rs 150 crore each.” He added that assets, including houses, vacant plots, vehicles, Fixed Deposits (FDs) worth Rs 9.5 crore, belonging to the four accused in Mandi and Kangra districts have been seized so far under BUDS Act. Movable and immovable assets belonging to the kingpin in Mandi have also been confiscated, the police said. However, victims alleged that despite crying foul since December 2022 — after team leaders stopped receiving their weekly returns — the authorities started a probe only nine months later, when Independent MLA Hoshyar Singh, from Kangra district’s Dehra, raised the issue in Vidhan Sabha. Singh told The Indian Express, “I wanted to raise the matter in the Assembly, so I collected evidence through a decoy investor, who had a digital ID and was a member of a WhatsApp group with nearly 600 investors. From that group, I got a list of 450 investors — most of whom are residents of my constituency — who had collectively lost Rs 6 crore. I also collected records on team leaders and the main suspects, most of whom are behind bars at present.” Though Singh has been encouraging victims from his constituency to lodge police complaints, many are hesitant to do so, hoping that agents who convinced them to ‘invest’ will return their money. “My agent is the son-in-law of someone in our village. He has assured some people now that he will refund their money. I am hopeful of getting a refund, which is why I have not yet lodged a police complaint,” said Jeevan Kumar, a small-time farmer from Lower Snehra village who also does daily-wage work to make ends meet. Sukhjinder Singh Dhadhwal, another investor, said, “Who should we complain against? The man who asked us to invest in the scheme is a relative. He has suffered a huge loss himself. We are in a fix too.”
Agents in uniform, motivational speeches & lavish parties: How a Himachal crypto con went unnoticed
