The four accused operated with the front of Bengaluru-based Longrich Technologies and promised investors daily returns of between 1% and 2%
The group targeted tech-savvy victims who had enough knowledge of cryptocurrencies to consider them as an investment.
According to the police, the group has earned more than INR 100 Cr through the scam.
Four persons have been arrested in Kerala’s Kannur district for allegedly running a Ponzi scheme masked as a cryptocurrency investment scheme. The Kannur Police have named Mohammed Riyas and four others in the scam.
The accused initially began the scam as a run-of-the-mill Ponzi Scheme where they promised investors daily returns of 1%-2% if they invested in Bengaluru-based ‘Longrich Technologies’.
After they began paying older investors with the money they got from new investors, word-of-mouth spread quickly and they were able to get more ‘investors’ on board. Just as it happens with almost all Ponzi schemes, they were soon unable to find new victims whose money could be used to pay off older investors.
When victims of the scam began raising questions about their money, the group offered to return their investments in the form of a cryptocurrency called Morris Coin. The founder of Morris Coin Nishad (who hails from the district of Malappuram in Kerala) was arrested in October as part of a similar scam.
“They particularly targeted tech-savvy people who had knowledge about cryptocurrencies,” said Kannur ACP P P…