Probe agency ED seizes Rs 55.36 crore of shell companies in Hyderabad token scam

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Financial probe agency the Enforcement Directorate on Tuesday seized assets worth approximately Rs 55.36 crore linked to the HPZ app-based token scam case and its alleged involvement in a multi-crore Bitcoin investment scam in Hyderabad. The seizure of assets comes as part of the ongoing investigation into the misuse of the HPZ app-based token. The scam also extended to fraudulent investments related to online gaming and betting. A probe has now revealed a larger conspiracy and the nexus of several entities in a fraud case involving Chinese entities. These attached assets are primarily in the form of balances held in bank accounts and merchant IDs associated with various shell and Chinese-linked entities. These accounts were used to facilitate funds related to illegal online gaming, betting activities, and investments in Bitcoin mining.The HPZ is an app-based token which promises users large gains by investing in mining machines for Bitcoin and other cryptocurrencies.HPZ APP-BASED TOKEN UNDER SCANNERED’s actions follow its earlier decision to freeze HPZ’s assets. In April this year, the ED had frozen Rs 91.6 crore parked in different bank accounts belonging to the entities controlled by one Bhupesh Arora and his associates, accused of misusing the app-based token to operate illegal gaming apps and websites.Subsequently, the ED ordered the freezing of these properties, initially frozen under section 17 of the Prevention of Money Laundering Act (PMLA).The ED’s investigation began following a First Information Report (FIR) registered by the Cyber Crime Police Station in the capital of Nagaland. As per the FIR, the fraudsters used a modus operandi that enticed victims to invest in the HPZ app-based token, on the pretext of astronomical returns on their investments in Bitcoin mining.Investors were promised returns, with an investment of Rs 57,000 yielding Rs 4,000 per day for three months. However, the promised returns were often paid only once, after which, additional funds were asked from the victims.The ED, so far, has conducted a nationwide search across 26 locations in 2022 and 18 locations in 2023.In total, the agency has frozen assets linked to HPZ valued at approximately Rs 176.67 crore, the ED said, while adding that authorities are seeking to “uncover the full extent of the alleged financial wrongdoing”.Edited By: Srishti JhaPublished On: Sep 27, 2023ALSO READ | BJP’s Ramesh Bidhuri, who shouted anti-Muslim slurs, gets key poll responsibility

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