The recent bust of a cryptocurrency investment scam impersonating “Morgan Stanley” by Cyberabad cyber crime police has shed light on the growing issue of online fraud in the digital currency world. The arrest of 22-year-old Pathi Manikanta from YSR Kadapa district in Andhra Pradesh has exposed a web of deceit that involved crypto traders, agents, and Chinese nationals, with the remaining accomplices currently on the run.
It all started when a 47-year-old software engineer filed a complaint in August 2024 after losing a significant sum of 55,066 USDT (equivalent to Rs. 52.31 lakh) in a fraudulent crypto investment scheme that promised a daily return of 20 percent. Manikanta, using multiple UK based WhatsApp numbers, reached out to the victim through Telegram and WhatsApp, posing as representatives of Morgan Stanley and enticing the victim to invest in their scam.
The accused went to great lengths to cover their tracks, using sophisticated layering techniques to transfer the ill-gotten gains across various crypto platforms like Binance, Kucoin, and Trust Wallet. This complex money laundering operation required the formation of a specialized team comprising tech-savvy police personnel and crypto experts to trace the origins of the crime, leading to connections with criminal groups in China, Hong Kong, and the United Kingdom.
Further investigation revealed that the accused had links to Chinese criminal organizations, engaging in the purchase and distribution of mule bank accounts through Telegram. The recovery of Udhyam registration certificates on the accused’s phone pointed towards a wider operation involving the opening of mule accounts in banks for illicit activities.
Following a court order, Binance has seized the stolen assets, with assistance from Indian Cyber Crime Coordination Centre (I4C), the Ministry of Home Affairs (MHA) cryptocurrency investigation team, and FIU-Ind to expedite the recovery process. In light of this incident, Cyberabad police issued a warning to the public to exercise caution when investing in cryptocurrency, especially in schemes that seem too good to be true, emphasizing the importance of verifying a company’s credentials before committing funds.
Investing in cryptocurrency carries inherent risks due to its decentralized nature, and individuals are urged to report any suspicious activities to the authorities through the designated channels. As the investigation unfolds, it serves as a stark reminder of the dangers lurking in the digital realm, urging vigilance and due diligence in financial transactions involving cryptocurrencies.