Indian police have arrested Divyesh Darji, head of the Asian division of multi-billion dollar cryptocurrency fraud Bitconnect, after he landed at Delhi airport on Saturday.
The Times of India published a report on Darji’s arrest on August 19, stating that immigration authorities intercepted the Indian native based on a “look-out notice” after he disembarked a flight from Dubai.
India’s Criminal Investigation Department (CID) had been investigating Bitconnect after the company allegedly raised billions of dollars from investors around the world through what was widely suspected as a Ponzi scam. The company even held an initial coin offering (ICO) of Bitconnect coins, which were valued at hundreds of dollars per coin before the scam was exposed.
Ashish Bhatia of the CID said that Bitconnect “promoted the company on social media and by holding gala functions in cities across the world. They lured investors with 60% monthly interest and incentives in the form of ‘referral interest,’” a tactic used often by Ponzi scams.
Bitconnect was served a cease and desist letter by regulators from Texas and North Carolina, which accused the company of violating securities law and conducting fraudulent sales, forcing them to shut down the BCC crypto exchange. At the height of their operation, Bitconnect was worth about $3 billion, but, after the closure of BCC, the value of their coin collapsed from hundreds of dollars per coin to less than a dollar.
According to a recent report, investors have lost $100 million on ICO exit scams.