Nagpur: In what could emerge as one of the largest cryptocurrency-linked investment frauds investigated in the region, the Economic Offences Wing (EOW) of Nagpur Police has busted an alleged network that lured thousands of investors across multiple states with promises of extraordinary returns through so-called “Free Coin” and “Merchant Coin” digital assets.

The investigation has led to the arrest of Nagpur-based agent Mihul Shivaji Dixit and Rakesh Kumar Mohanlal Garg alias Rakesh Agrawal, director of Punjab-based CLBP System Private Limited Collection Company, for allegedly operating and promoting the scheme.

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The action follows a complaint lodged by Reema Ranjan Ghosh, a resident of Ramnagar, at Pachpaoli Police Station. According to investigators, the accused persuaded investors to put money into a scheme called Future Digital Assets (FDA) by claiming that investments would generate substantial profits within 100 days. Investors were also promised massive gains through digital tokens branded as “Free Coin” and “Merchant Coin.”

Investigators revealed that prospective investors were allegedly drawn into the scheme through company websites, YouTube presentations, Telegram meetings and online dashboards that displayed virtual earnings and investment growth. The accused reportedly projected the venture as a revolutionary digital asset platform capable of generating high returns in a short period.

The scheme also allegedly operated on a chain or referral model, where participants were encouraged to recruit new members with promises of earning lakhs of rupees every month through expanding networks.

Believing these claims, the complainant and several others invested money in the project. However, despite repeated assurances, investors allegedly received no actual returns.

According to the complaint, investors were further told that the value of Merchant Coin would eventually soar to Rs 1 lakh per coin, prompting many to make additional investments. The complainant alone allegedly paid Rs 2.25 lakh after being convinced of the coin’s future value.

While online wallets displayed large virtual balances, investigators found that investors were unable to withdraw the funds. When they sought refunds, company representatives allegedly cited internal rules and conditions to avoid repayment.

During the initial investigation, police found that at least 25 investors connected to the complainant had collectively been cheated of around Rs 5.40 lakh.

However, a deeper probe uncovered a far larger operation. According to the Economic Offences Wing, more than 31,117 investors from Maharashtra and other states had reportedly invested money through the platform.

Investigators also discovered that the company’s digital ecosystem was linked to more than 10.24 lakh users, including nearly 30,000 users from Nagpur alone.

The findings have raised concerns about the scale of the operation and the number of people who may have been exposed to financial risk.

Accounts frozen, electronic evidence seized

As part of the crackdown, the EOW seized laptops, mobile phones and other electronic devices believed to contain crucial evidence regarding the company’s financial transactions and digital operations.

Police have also frozen bank accounts and fixed deposits linked to the accused, securing approximately Rs 1.72 crore as part of the ongoing investigation.

Mihul Dixit was arrested from Nagpur, while Rakesh Garg was apprehended from Chandigarh. Both have been booked under relevant provisions relating to cheating and financial fraud.

Investigators believe the case may have wider ramifications as they examine financial trails, investor databases and digital transaction records. Officials said timely registration of the offence may have prevented many more people from investing in the scheme and suffering financial losses.

“Investigators estimate that more than 31,117 investors may have invested nearly Rs 1,558 crore (Rs 15.58 billion) through the network, making it one of the largest alleged digital investment frauds under investigation.”

The Economic Offences Wing is continuing its investigation to identify additional beneficiaries, agents and entities connected to the operation. Authorities have not ruled out further arrests as the probe progresses.