CBI Chargesheet Names Chinese Nationals in Rs 1,000 Crore…

The Central Bureau of Investigation (CBI) has filed a comprehensive chargesheet against 30 individuals, including two Chinese nationals, in connection with the Rs 1,000 crore HPZ Token investment scam. This elaborate fraud, which exploited citizens during the COVID-19 lockdown, utilized a fake mobile application to promise high returns on cryptocurrency mining investments.

Key Takeaways

Two Chinese nationals, Wan Jun and Li Anming, are identified as masterminds.
The scam involved a fake mobile app, 'HPZ Tokens', promising high returns on crypto mining.
Over Rs 1,000 crore was siphoned off through a network of shell companies.
The syndicate operated a wider cybercrime network, including fake loan apps and job offers.
Payment aggregators were misused to rapidly launder funds.

The HPZ Token Scam Unveiled

The HPZ Token scam operated through a fake mobile application that lured investors with promises of substantial returns from cryptocurrency mining. Officials revealed that the syndicate, controlled by foreign nationals, collected over Rs 1,000 crore through shell companies within months. This case is part of a larger, well-coordinated cybercrime network that targeted Indian citizens with various fraudulent schemes, including fake loan apps and bogus online job offers, particularly during the post-COVID period.

Masterminds and Shell Companies

Chinese nationals Wan Jun and Li Anming are central figures in the chargesheet. Wan Jun, identified as a director of Jilian Consultants India Private Limited, a subsidiary of a Chinese entity, allegedly established numerous shell companies, including Shigoo Technologies, with the assistance of another accused, Dortse. These shell entities served as conduits to collect and launder the proceeds of the crime. The Enforcement Directorate (ED) has also been involved, with one key accused, Bhupesh Arora, declared a fugitive economic offender and assets worth hundreds of crores frozen or attached.

Exploitation of Payment Systems

Investigators found that the syndicate sophisticatedly exploited India's nascent payment aggregation system. These systems, designed for genuine companies, allowed the fraudsters to rapidly move money between multiple shell accounts and disburse small amounts back to investors to build trust. The collected funds were then converted into cryptocurrencies before being sent out of the country. The CBI's chargesheet names 27 individuals and three companies in addition to the two Chinese nationals, with investigations ongoing against other gang members.

Modus Operandi and Impact

The fraudsters lured victims by promising to double their investments through the HPZ Token app, online gaming, and betting websites. They opened numerous bank accounts and merchant IDs under various shell entities with dummy directors to layer the illicit funds. Initially, promised returns were paid to gain investor confidence, encouraging further investments before the app and related websites became inaccessible. The ED has attached and frozen substantial assets in connection with this scam.

Sources

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CBI Chargesheet Names Chinese Nationals in Rs 1,000 Crore HPZ Token Crypto Scam