Fourteen Individuals Sentenced to Life Imprisonment in Bitcoin Extortion Scandal

An Indian anti-corruption tribunal has condemned 14 persons, comprising 11 police personnel and a former Bharatiya Janata Party (BJP) Member of Legislative Assembly (MLA), to life sentences in a case concerning the abduction and extortion of cryptocurrency from a businessman based in Surat in 2018.

The ruling, issued by Special Judge B.B. Jadav in Ahmedabad on Friday, found the group guilty of criminal conspiracy, kidnapping for ransom, unlawful detention, and battery, as reported by The Times of India.

Those found guilty include former Amreli district superintendent of police Jagdish Patel and ex-MLA Nalin Kotadiya. All 11 police officials, including the ex-IPS officer Patel, were also deemed guilty under the Prevention of Corruption Act for malfeasance by public servants.

The case revolves around businessman Shailesh Bhatt, who had reportedly reclaimed part of his lost investment from BitConnect developer Dhaval Mavani in the form of Bitcoin (BTC), following the collapse of the $900 million enterprise he invested in.

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Surat businessman seized over Bitcoin

Upon discovering that Bhatt had managed to retrieve a fraction of his investments, Kotadiya and senior officials in Amreli allegedly devised a scheme to confiscate the cryptocurrency. On Feb. 11, 2018, Bhatt was kidnapped and unlawfully detained at Keshav Farm near Gandhinagar.

The abduction was orchestrated by Amreli local crime branch inspector Anant Patel and involved several officers. Bhatt was reportedly assaulted and coerced into confessing that he had received 752 Bitcoin from Mavani and had stored 176 of them with his associate, Kirit Paladiya. The remainder was liquidated for about $5 million.

Bhatt was liberated only after agreeing to transfer some of the Bitcoin along with $3.6 million in cash. When the arrangement failed, the accused compelled Bhatt to sell 34 Bitcoin from Paladiya’s wallet, culminating in an extortion of $150,000.

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Crypto abduction investigation spurs 15 arrests

Bhatt later lodged a complaint with the Union home ministry, prompting a criminal inquiry and the apprehension of 15 individuals. The prosecution, directed by special public prosecutor Amit Patel, presented 173 witnesses during the proceedings.

The court also mandated the seizure of gold ornaments retrieved from Amreli SP Patel, which will be handed over to the Master of Mint in Mumbai.