“Crypto isn’t legal. But, i’ll tax it”, this has been the stance of the Indian Government, while the Law Enforcement during the course of a investigating a complaint of any financial fraud, just blindly blocks ANY account involved the transaction related to crypto. The fraudsters make use of crypto trading platforms to launder their money into crypto assets, and who is the scape goat here ? unsuspecting crypto investors who work for a 2% to 5% margin and supposedly “trade” on these platforms such as Binance, Coinbase Exchange, WazirX App, Kucoin, ZebPay App etc. These trading platforms too do not perform any KYC Verification on accounts giving a golden opportunity to fraudsters to launder money on these platforms.
While blocking all relevant accounts are good practice to avoid financial loss to the defacto complainant, law enforcement must conduct due investigations to ensure whether the account belongs to fraudsters or genuine traders, and take measures to release the held amounts. I, Adv. Sathya Narayanan Subramanian (Sathya at vsmlegal dot in) post regularly about cyber law related matters. I have been vocal about this on various occasions. But, when we represent clients viz genuine traders, the LEAs at current are demanding 100% of the disputed amount as compensation to the victims, or most times simply demanding 50% of the entire amount lying in the account as compensation to release the hold / account block status on these crypto dealt bank accounts.
Magistrates are not entertaining ‘return of property’ petitions, and simply asking to wait until the investigation is over. LEAs are merely scapegoating those with money in their accounts, and letting go of the investigation from there. I am talking about majority of cyber-cell units. And, not everyone. I do come across very successful attempts to grab fraudsters and I sincerely applaud their efforts in doing so. But, the end doesn’t justify the means.
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