Eight arrested in cross-border digital currency scam linked to Chinese handlers and mule accounts
Lucknow Police bust an ₹80 lakh USDT crypto fraud racket, arresting eight individuals involved in laundering digital assets through Telegram and anonymous wallets.
In a significant blow to digital currency-related crime, the Lucknow Police Cyber Crime unit has uncovered an elaborate ₹80 lakh scam involving illegal USDT (Tether) cryptocurrency transactions. The operation led to the arrest of eight individuals believed to be part of a sophisticated syndicate using anonymous wallets, mule accounts, and Telegram-based channels to funnel illicit funds.
The arrests were made across different locations in Lucknow, following a coordinated operation led by Inspector Brijesh Kumar Yadav and supervised by senior officers from the Cyber Crime Police Station, including the Joint Commissioner of Police (Crime), Deputy Commissioner of Police (Crime), Additional DCP (Crime), and Assistant Commissioners from Gossaiganj and the Crime Branch.
A cyber crime press release on Saturday confirmed that a First Information Report (FIR) has been filed at the Cyber Crime Police Station under Sections 317(2), 318(4), 61(2), and 111(2)(B) of the Bharatiya Nyaya Sanhita (BNS) and Sections 66C and 66D of the Information Technology Act.
According to the police, the accused were operating a highly structured fraud ring with international links. Over the past two months, nearly ₹80 lakh was siphoned off through bogus crypto deals, conducted outside the purview of any legitimate exchange. The transactions were orchestrated via Telegram channels, reportedly run by handlers based in China, leveraging the TRC-20 blockchain network to evade scrutiny.
“The gang’s operation revolved around recruiting Indian account holders who were paid a commission to receive high-value bank transfers through NEFT, RTGS, or IMPS. These funds were withdrawn in cash and handed over to underground crypto brokers,” the press release stated.
The brokers then converted the funds into USDT via peer-to-peer (P2P) wallets—decentralized platforms that allow trading without Know Your Customer (KYC) verifications. The anonymity offered by these platforms made it nearly impossible for authorities to trace the origin or destination of the digital assets.
During interrogation, the accused claimed to be legitimate crypto traders but failed to provide any exchange documentation, tax records, or wallet verification details. Authorities confirmed that the wallets were deliberately chosen for their lack of jurisdictional oversight, making them ideal tools for laundering money.
The arrested individuals have been identified as Satyam Tiwari (21, Lucknow), Diwakar Vikram Singh (21, Basti), Saksham Tiwari (21, Raebareli), Vinod Kumar (24, Gonda), Krish Shukla (25, Lucknow), Mohd. Shad (31, Barabanki), Laiq Ahmed (32, Gonda; currently residing in Lucknow), and Manish Jaiswal (40, Lucknow).
From the suspects, the police recovered 16 mobile phones, two laptops, a tablet, ₹1.85 lakh in cash, three cheque books, a passbook, and four vehicles. Authorities said they are actively tracing additional linked accounts and crypto wallet addresses, with further arrests anticipated.
A senior police official noted, “The gang exploited regulatory gaps in cryptocurrency and loopholes in bank account verification systems to run a cross-border financial crime operation masked as trading.”
Investigations remain ongoing, particularly to uncover the foreign network behind the fraud and identify more Indian collaborators involved in this widespread digital scam.
