ED arrests two in ₹400 crore fraud case routed through USDT

What happened

The ED's Chennai Zonal Office-II arrested two people, named in reports as Roshan Fiaz and Ammar, on 30 October under the Prevention of Money Laundering Act, 2002. The agency announced the arrests in a statement dated 5 November, and a court has remanded both to judicial custody, according to IANS.

According to the ED, as reported by DT Next and The Crypto Times:

• victims were contacted through social media with fake investment, share-market and job offers, and induced to send money,
• the money landed in mule bank accounts, was split into smaller amounts and moved through more accounts,
• part was withdrawn in cash and part was converted into USDT, and
• the funds are linked to more than 600 complaints, with proceeds above ₹400 crore.

The ED says one of the accused controlled 31 bank accounts, in his own name, his wife's and entities he controlled, with transactions above ₹300 crore. It says the other supplied mule accounts along with net-banking credentials, SIM cards, phones and email IDs, so that rupees could be received from crypto buyers. Siasat reports an FIR filed by Cyberabad police helped the investigation.

Why it matters for Indian crypto users

This case shows exactly how fraud money reaches ordinary crypto traders. When someone sells USDT for rupees on a P2P platform, the rupees come from the buyer's bank account. If that account is a mule account fed by fraud victims, police can trace the money, and the seller's account can be frozen while they investigate, sometimes for months.

It's also a reminder that the "investment" and "part-time job" offers that start these chains are aimed at ordinary people. See crypto scams in India.

What to do now

• Be careful with P2P. Trade with verified counterparties with long histories, receive money only from an account in the buyer's own name, avoid unusually good rates, and keep screenshots of every trade. Full guide: P2P crypto and bank account freezes.
• Prefer direct INR deposits on FIU-registered exchanges where possible. See the exchange safety board.
• Never rent out or "lend" your bank account, SIM or net-banking login, whatever the offer. Account holders get pulled into investigations.
• If you lose money to a scam, call 1930 and file at cybercrime.gov.in quickly. See what to do if you've been scammed.

What we don't know yet

Which crypto platforms or P2P venues were used hasn't been publicly detailed, and the court has not ruled on the allegations. We'll update this story if the ED or the court releases more.

Frequently asked questions

What is a mule bank account?

A bank account opened or rented out in someone else's name and used to receive and pass on money, often from fraud. People who lend their accounts for a fee can face investigation even if they didn't run the scam.

How does this affect P2P crypto traders?

According to the ED, mule accounts were used to receive rupees from crypto buyers. If you sell USDT on P2P and the rupees come from such an account, your bank account can be frozen during an investigation even if you did nothing wrong.

Have the accused been convicted?

No. They were arrested under the PMLA and remanded to judicial custody. The allegations remain subject to court proceedings.

Sources

• The Crypto Times: India's ED arrests two in ₹400 crore cyber fraud probe involving USDT
• DT Next: ED arrests two from Tamil Nadu in Rs 400-crore pan India cyber fraud network
• Siasat: FIR in Cyberabad helps ED uncover Rs 400 crore cyber fraud
• IANS via Hi India: Two arrested in online fraud case; court remands accused to judicial custody

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