June 18, 2024
By Anjali Kochhar
India’s Enforcement Directorate (ED) has discovered a major Ponzi fraud involving cryptocurrency operations run by Highrich Online Group and its digital currency, HR Crypto Coin. The raid, which began on June 11, saw searches conducted at 14 locations in Kerala, Maharashtra, and Chhattisgarh, targeting the group’s promoters and leaders under the Prevention of Money Laundering Act (PMLA), 2002.
The ED’s investigation revealed that the Highrich Online Group and its affiliates were deeply involved in cryptocurrency trading on multiple exchanges while simultaneously promoting and selling their own HR Crypto Coin. The scheme lured investors with promises of a 15% annual interest rate and a 30% direct referral income for introducing new customers.
Originating from a first information report (FIR) by the Kerala Police, the investigation was propelled by numerous complaints against the Highrich Group and its directors. The company was selling memberships as digital IDs, which gave users access to their website for a fee. These memberships were then resold by members to others, with commissions and extra incentives for referrals, forming a classic Ponzi scheme with no real underlying business.
The ED’s search operations resulted in significant asset seizures and freezing. Approximately Rs. 32 crore ($3.9 million) were frozen in various bank accounts associated with the company and its promoters. Additionally, authorities seized around Rs. 70 lakh ($85,365) in cash, jewelry, and four vehicles. The searches also uncovered immovable properties worth Rs. 15 crore ($1.7 million), acquired through illicit funds.
In a prior operation in January, the ED searched the offices of Highrich Smartech Pvt. Ltd., Highrich Online Shoppe Pvt. Ltd., and linked organizations, unearthing Rs. 212 crore ($25.3 million) in illicit cash that were later frozen under the PMLA. The total proceeds of crime seized or frozen today stands at Rs. 260 crore ($31.1 million), which includes immovable property records.
The ED’s actions highlight the Indian authorities’ ongoing efforts to crack down on fraudulent schemes in the burgeoning cryptocurrency market.
About the author
Anjali Kochhar covers cryptocurrency stories in India as well as globally. Having been in the field of media and journalism for over three years now, she has developed a sharp news sense and works hard to present information that goes beyond the obvious. She is an avid reader and loves writing on a wide range of subjects.
