Surat builder held for extorting bitcoins, cash

The Gujarat police have booked a Surat-based builder Shailesh Bhatt and eight others for allegedly extorting over ₹155 crore in cash and bitcoins from two persons.

Bhatt had in February accused a team of Amreli crime branch police of abducting him and extorting 176 bitcoins worth ₹7.5 crore from him. Nine policemen, including an SP, were booked on his complaint. While investigating the case, the state Criminal Investigation Department (CID) learnt about a bitcoin ponzi scheme worth ₹1,000 crore, in which Bhatt had invested.

“Around two years back, one Satish Kumbhani of Surat floated a company called Bit Connect and lured people like Bhatt to invest in it to get huge returns. Bhatt had invested ₹2 crore in it. However, its promoters shut shop in January this year and went underground,” said director general of police (CID) Ashish Bhatia.

To recover his investment, Bhatt’s accomplices first kidnapped one Piyush Savalia by posing as income tax officials. Savalia used to work with Bit Connect and was confined in a farm house at gun point for three days in January, Bhatia said.

“On February 1, Bhatt’s men kidnapped Dhaval Mavani at gun-point and forced him to transfer 2,256 bitcoins worth ₹131 crore into their account. The builder and his accomplices had also transferred another set of 166 bitcoins worth ₹9.64 crore into their account,” said Bhatia.

To set Mavani free, Bhatt and his accomplices also extorted ₹14.5 crore in cash from his family, which the builder received through the Angadia service (an unofficial cash courier service), he said. “Bhatt and his accomplices extorted bitcoins and cash worth ₹155.14 crore. Later, they distributed the bitcoins among themselves. Bhatt kept around 700 bitcoins,” the CID official said, adding since Bhatt was not techsavvy, he took the help of his nephew Nikunj Bhatt to transfer these bitcoins.

The conspiracy was unearthed when Savalia was questioned by the CID. Bhatia said Bhatt had even paid ₹34.5 lakh to Savalia to give a false statement that he was never kidnapped by the builder and his men. While two persons, including Bhatt’s nephew, Nikunj, and Dilip Kanani have been arrested on charges of kidnapping and extortion, a search is on for others. “A fresh FIR against Bhatt and his aides has been registered after details emerged during the ongoing probe,’’ Bhatia told reporters.

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