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The Enforcement Directorate conducted searches at 11 locations in Kerala, Tamil Nadu, Karnataka, and Delhi for the last few days (Representational)  | &nbspPhoto Credit:&nbspiStock Images

Key Highlights

  • According to ED sources, investments in bogus cryptocurrencies were made in 2020, primarily during the lockdown
  • Nishad aged 31, of Pookkottumpadam village in Malappuram district, has been identified as the fraud’s mastermind by the ED

Thiruvananthapuram: On Wednesday, Enforcement Directorate officers said that at least 900 people were defrauded of over Rs 1,200 crore after investing in an “initial coin offering” issued by a Kerala man for a non-existent cryptocurrency.

According to ED sources, investments in bogus cryptocurrencies were made in 2020, primarily during the lockdown.

According to officials, the victims purchased “Morris Coin,” which is listed on the Franc Platform cryptocurrency exchange in Coimbatore, in a manner like an initial public offering.

A source in the ED said to The Indian Express, “Ten Morris coins were valued at Rs 15,000 with a lock-in period of 300 days. The currency was fake. The investors were given an e-wallet and told that the coin value would boom when traded in the exchange.”

“But the promoters of the coin siphoned out the money and illegally invested in immovable properties in Kerala, Tamil Nadu and Karnataka, particularly in real estate without showing any source of income,” the source further added.

The Enforcement Directorate conducted searches at 11 locations in Kerala, Tamil Nadu, Karnataka, and Delhi for the last few days. Searches were also conducted in places including the Bengaluru-based Long Rich Technologies and Morris Trading Solutions.

Unni Mukundan Films Pvt. Ltd, a company founded by Malayalam actor Unni Mukundan, and Nextel Group, were among the locations that were searched by the ED, the IE reported. 

Nishad aged 31, of Pookkottumpadam village in Malappuram district, has been identified as the fraud’s mastermind by the ED. Officials from the ED stated the actor had ties to Nishad.

After police in Kannur and Malappuram districts filed various complaints against Nishad and others under Section 420 (Cheating) of the Indian Penal Code (IPC), the Directorate took up the case last year.

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The alleged criminals were also involved in a Ponzi scheme. After the company stopped paying the promised profits, many of the investors went to the police and complained, IE reported.

Nishad had fled the country after being granted anticipatory bail in the police charges by the Kerala High Court.