Surat Police cracked down on a growing crypto investment racket that cheated dozens of investors across Gujarat. Investigators arrested three agents who lured people with false promises of tripling their money through coins like PLC Ultima, Aura Coin, and BDLT. The operation exposed how small-town scams now use digital currencies to exploit public curiosity about crypto profits.
The Scam Unfolds
The scam started in 2023, when the three agents—identified as Rakesh Patel, Dhruv Mehta, and Sanjay Desai—began promoting a “crypto investment program” across Surat, Navsari, and Valsad districts. They organized small seminars, online webinars, and WhatsApp groups to advertise what they called “a revolutionary blockchain opportunity.”
They claimed investors could earn 200% returns within six months through “smart contracts” and “automated trading bots.” They spoke about financial freedom, decentralized wealth, and “early entry” benefits. They used buzzwords like mining, staking, and token burning to impress people who barely understood cryptocurrency.
The trio collected deposits in both rupees and USDT (Tether). They transferred funds into offshore wallets, supposedly for “crypto arbitrage trading.” In reality, they moved the money through multiple exchanges and peer-to-peer transactions, hiding trails before withdrawing it through local OTC desks.
Victims Start Complaining
By mid-2024, investors began demanding returns. The agents stalled them with excuses—server upgrades, exchange maintenance, and government crackdowns. When investors insisted on refunds, the scammers threatened to block them from the “ecosystem” and delete their wallets.
One victim, Paresh Shah, lost ₹6.8 lakh. He said, “They showed fake dashboards that displayed growing profits. I thought my money doubled. When I tried to withdraw, everything disappeared.”
As complaints grew, a local traders’ association urged the police to investigate. The Economic Offences Wing (EOW) of Surat City Police launched a probe in early 2025.
The Investigation
Investigators traced multiple bank accounts linked to the suspects. They found large deposits from small investors followed by quick transfers to crypto exchanges based in Dubai and Singapore. The suspects used Binance, KuCoin, and OKX to move the funds into stablecoins.
Police froze 12 bank accounts holding ₹32 lakh and seized mobile phones, laptops, and digital ledgers that contained wallet addresses. They discovered that the scam operated like a pyramid. Each investor had to recruit two more participants to unlock “profit cycles.” The scheme rewarded early joiners with money from later investors—a classic Ponzi pattern.
The EOW also found voice notes, videos, and PowerPoint presentations where the accused posed as crypto educators. They used glossy presentations showing sports cars, beach houses, and charts of “future valuations.”
Police Crackdown
On Sunday night, officers raided a rented office in Surat’s Vesu area and arrested the three accused. Police charged them under Sections 406 (criminal breach of trust), 420 (cheating), and 120B (criminal conspiracy) of the Indian Penal Code, along with provisions of the Information Technology Act.
During interrogation, the suspects admitted they collected around ₹54 lakh from nearly 40 investors. They claimed they also lost money when “the market crashed,” but officers found no such trades in their records. The trio used most of the money for personal expenses, luxury gadgets, and overseas travel.
“We wanted quick success,” one of them reportedly told investigators. “We thought crypto was a shortcut.”
How the Scam Worked
The scam followed a simple but effective pattern:
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Attract — The agents used social media ads and free webinars to draw investors.
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Convince — They promised fixed monthly returns, showing fake screenshots of profits.
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Collect — They asked for deposits through UPI, cash, or crypto wallets.
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Delay — They cited “network issues” to block withdrawals.
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Disperse — They moved funds to foreign wallets and local OTC crypto traders.
The use of offshore exchanges made recovery difficult. Investigators are coordinating with cybercrime units and the Enforcement Directorate (ED) to track the flow of funds abroad.
Victims Seek Justice
Dozens of victims have filed complaints. Many are small traders, teachers, and homemakers who invested savings hoping for fast profits.
One investor, Kiran Patel, said, “They made crypto sound safe. They said the government approved it. I believed them because they showed official-looking certificates.”
Another victim, Sejal Desai, lost ₹3.2 lakh. She said, “They created a WhatsApp group called Crypto Future Club. Every day, they posted motivational quotes and fake profit screenshots. It looked real until they disappeared.”
The EOW has set up a helpline and urged other victims to come forward. Police believe the scam could exceed ₹1 crore once all cases surface.
Crypto Awareness Still Low
The incident highlights how scammers exploit India’s low financial literacy around crypto. Many investors still think cryptocurrency guarantees high returns or operates under government backing.
The Reserve Bank of India (RBI) and the Ministry of Finance have repeatedly warned against unregulated digital investments. Yet, scams continue because people trust social media influencers and local promoters more than official advisories.
Cyber-law expert Adv. Nihar Shah said, “These scams succeed because people chase unrealistic profits. Regulation can help, but awareness matters more. If something promises 300% returns, it’s not investment—it’s deception.”
Role of Regulation
India’s regulatory stance on crypto remains cautious. The government taxes digital asset gains at 30%, discouraging casual trading. The Financial Intelligence Unit (FIU) monitors exchanges for suspicious transactions, but scams like this often stay below detection thresholds because they use small, scattered deposits.
In 2025, several Indian exchanges introduced Know-Your-Customer (KYC) verification and fraud-alert systems. Still, unregistered agents continue to operate freely, especially in Tier-2 cities.
Surat Police plan to recommend a coordinated task force combining EOW, ED, and cybercrime units to investigate similar frauds across Gujarat. They also intend to run public awareness drives in local languages to warn people about crypto Ponzi schemes.
The Psychology Behind Such Scams
Financial psychologist Dr. Reema Jaiswal explains why such scams thrive: “Crypto creates a fear of missing out. When people see others making fast profits, they feel they must join. Scammers exploit that emotion. They build trust with small rewards, then vanish once the money grows.”
The arrested agents followed this exact pattern. They initially paid small returns to early investors, building credibility. Once enough people invested larger sums, they closed communication channels and withdrew funds.
Lessons for Investors
The Surat case offers several key lessons:
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Verify before investing. Always check if a company or scheme is registered with the Securities and Exchange Board of India (SEBI) or operates under legal licenses.
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Avoid unrealistic promises. Legitimate crypto investments never guarantee fixed returns.
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Beware of referral bonuses. If earnings depend on recruiting others, it’s likely a pyramid scheme.
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Check exchange credibility. Use only registered crypto exchanges that comply with KYC and anti-money-laundering norms.
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Keep documentation. Maintain screenshots, receipts, and wallet addresses. These records help during investigations.
A Larger Warning
Surat’s crypto scam is not an isolated event. Similar frauds have emerged in Maharashtra, Punjab, and Karnataka, where agents promise huge returns through unknown coins. The Economic Offences Wing in Mumbai recently warned that over ₹1,200 crore vanished nationwide in such schemes in 2024-25.
The pattern remains consistent: agents use local trust, fake online dashboards, and buzzwords like “AI trading,” “DeFi rewards,” and “blockchain mining.” Many victims never recover funds because the money quickly moves through international crypto networks.
Moving Forward
Police continue to interrogate the three accused and plan to track higher-level operators behind them. Investigators suspect a larger network with links to Dubai and Hong Kong. Cyber-forensic teams are analyzing seized devices to locate main wallets.
The EOW aims to file a detailed charge sheet within 30 days. Officers also plan to contact Indian crypto exchanges to trace whether any of the stolen funds passed through domestic accounts.
Assistant Commissioner Jignesh Rana said, “We will recover as much as possible. We also plan to hold awareness workshops so people recognize such traps before they lose money.”
Conclusion
The Surat arrests mark a critical moment in India’s fight against crypto-related fraud. The case exposes how easily unregulated agents exploit public enthusiasm for digital assets. It also proves that awareness and law enforcement must evolve together.
Crypto itself isn’t the enemy—ignorance is. As digital finance grows, every investor must learn the difference between innovation and illusion. When greed blinds judgment, scammers thrive. When knowledge guides choices, no scheme can survive.
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