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Corrupt CBI Inspector Booked for Extorting Vigilante Bitcoiner

India’s Central Bureau of Investigation (CBI) has reportedly booked its own officer in an extortion case involving bitcoin. The target was a man who previously fell victim to the Bitconnect scam and allegedly resorted to extreme measures to recoup his money.

Also read: China Now Censors Anti-Blockchain Sentiment, Educates Public on Bitcoin

Extorted by CBI Officer

The CBI has reportedly booked its own officer, inspector Sunil Nair, for allegedly extorting Rs 5 crore (~$700,506) from Shailesh Bhatt, an Indian businessman from Gujarat, local media reported on Friday.

According to the CBI, Nair used the bureau’s Gandhinagar office phone to call Bhatt and threatened him with enforcement action by the Enforcement Directorate (ED) and the Income Tax Department for “earning black money using bitcoin,” Press Trust of India detailed. The publication added that, according to the case’s First Information Report (FIR), Bhatt was neither “probed in any case pertaining to bitcoin” nor was “a wanted accused, witness or suspect, in any case.”

A case under the country’s Prevention of Corruption Act and criminal conspiracy has been registered against Nair and his associate, Krit Madhubhai Paladiya, who co-conspired with him to extort Bhatt. A senior CBI official told IANS publication Friday that “The agency carried out searches at six locations in Gujarat’s Surat and Gandhinagar at the residential premises of inspector Sunil Kumar Nair and a private person named Krit Madhubhai Paladiya.”

Complex Case of Extortions

This case is related to a major scam that surfaced in February last year which involved bitcoin, kidnapping, and several more extortions. It started with Bhatt filing a complaint against Gujarat’s Amreli district police for kidnapping him and extorting 200 BTC and Rs 32 crore (~$4.5 million) in cash. CCTV footage confirmed the extortion and Amreli Superintendent of Police Jagdish Patel, inspector Anant Patel, and eight other officers were arrested.

However, Bhatt himself was also accused of being involved in the kidnapping two people who worked for Bitconnect — Piyush Savalia and Dhaval Mavani — to extort 2,256 bitcoins, 11,000 litecoins, and Rs 14.50 crore in cash. In May last year, the Criminal Investigation Department (CID) reportedly registered an FIR against Bhatt and nine of his accomplices in Surat.

CID-Crime Director General of Police Ashish Bhatia explained at the time that Bhatt had invested Rs 2 crore in Bitconnect but its promoters closed down their shop in January and went underground. To recover their investments, Bhatt and his accomplices allegedly kidnapped Savalia by posing as Income Tax Department officials, and later kidnapped Mavani and forced him to transfer bitcoins to them. “Bhatt and his accomplices extorted bitcoins and cash worth a total of Rs 155.21 crore. Later, they distributed the bitcoins among themselves. Bhatt had kept around 700 bitcoins,” Bhatia was quoted as saying.

However, this case is being investigated by the Gujarat CID without the involvement of the CBI. Nair’s name first came up during the CID investigation back in February last year. He allegedly told Bhatt that he had strong evidence of him “extorting bitcoins” from Mavani, the CBI FIR describes. He then called Bhatt using the CBI’s office phone and “threatened him with dire consequences of getting him raided by Enforcement Directorate (ED) and Income Tax for earning black money from illegal acts and also demanded a bribe of Rs 10 crore to settle the matter,” the FIR adds.

After negotiations, “The deal was then finalized at Rs 5 crore and Bhatt paid Rs 4.6 crore to Nair,” the CBI revealed. Nair, however, continued to demand more payments over the next few days using the CBI’s office phone. According to the FIR, “It is only later that Bhatt realized that there was no such case against him and that he was fooled by the inspector.”

What do you think of this extortion case? Let us know in the comments section below.


Images courtesy of Shutterstock and the Indian Express.


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Kevin Helms

A student of Austrian Economics, Kevin found Bitcoin in 2011 and has been an evangelist ever since. His interests lie in Bitcoin security, open-source systems, network effects and the intersection between economics and cryptography.




Kevin Helms , 2019-11-10 09:30:38 ,

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NewsBlock © 2019 - 2020. All rights reserved.


While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Featured Image from Shutterstock


Nick Chong , 2019-11-10 12:00:38

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