New Delhi: The Enforcement Directorate (ED) has initiated a significant crackdown on cryptocurrency-related fraud, conducting searches in Delhi, Jaipur, and Mumbai under the Foreign Exchange Management Act (FEMA). The raids are part of an ongoing investigation into a major scam involving illegal crypto conversions valued at around ₹600 crore. The ED confirmed the operation in a press release on Monday.
The probe was sparked by a newspaper report detailing the fraudulent actions of Chirag Tomar, an Indian citizen currently serving a prison sentence in the U.S. for defrauding over $20 million (roughly ₹144 crore). Tomar’s scheme involved fake websites that impersonated the legitimate cryptocurrency exchange, Coinbase.
Investigators revealed that these fraudulent sites were manipulated to appear at the top of search engine results using malicious SEO tactics. This tricked users into entering their login credentials. Once victims provided their information, they were shown incorrect account details and prompted to call a fake customer support number, which connected them to a fraudulent call center operated by Tomar and his associates.
After gaining access to the victims’ cryptocurrency accounts, the scammers quickly transferred the assets to wallets under their control. The stolen funds were then sold on localbitcoins.com and converted into Indian Rupees through local crypto exchanges.
The ED’s investigation uncovered that a significant portion of the illicit proceeds—₹15 crore—was transferred to bank accounts belonging to Tomar and his family members. Authorities have since frozen several bank accounts linked to the Tomar family, seizing ₹2.18 crore to date.
During the raids, the ED also uncovered other instances of cryptocurrency fraud involving suspicious crypto sales on localbitcoins.com, followed by conversion into INR via Indian crypto platforms. This points to a wider network of cybercriminals using digital currencies for illegal financial activities.
The ED is continuing its investigation, and more seizures and legal actions are expected in the coming days.