According to local media reports, 2,508 investors in India lost a total of INR 7,343.6267 (approximately $890,000) by investing in Emoillent Coin. These investors acted in the hope that they could make huge profits thanks to the cryptocurrency hype.

However, all the promises made by Emoillent Coin were misleading and investors faced a huge loss.

This fake cryptocurrency, released under the name “Emollient Coin Limited”, implemented various strategies to attract users. It promised returns of up to 40% to users who locked their investments for ten months.

It also offered a multi-level referral scheme, encouraging users to bring in more investors. This scheme promised to pay up to 7% commission for each user it referred.

Multi-level referral schemes often form the basis of fraud schemes, and such schemes create an ongoing system to attract new members. Scams are carried out under the guise of non-existent projects that often promise high returns. Once enough investors are gathered, the scammers disappear with the funds.

In the Emollient Coin case, criminals were running the scheme through a mobile app. Funds were collected through bank transfers, cryptocurrency exchanges, and direct cash payments.

According to reports, scammers took advantage of Bitcoin’s popularity to persuade users to make investments. This strategy has been effective in attracting investors due to the high appreciation of Bitcoin and the popularity of cryptocurrencies in general.

Emollient Coin Limited falsely claimed that its real headquarters was London, but it actually had a local office in India. The company was run by a person named Henry Maxwell.

The fraud operation, which was active from 2017 to 2019, involved fraudsters deliberately terminating the company and causing losses to users. The Enforcement Directorate alleges that fraudsters used the stolen funds to acquire land assets.

In 2020, India’s law enforcement agency launched a search operation in Leh, the northern Indian town where the scam was centered, following complaints made to the Additional District Magistrate. Complaints show that the scam is wide-ranging and many people have fallen victim to it.

The accused — A R Mir, Ajay Kumar Choudhary and two other promoters — are accused of defrauding several people. Under the Prevention of Money Laundering Act, the Enforcement Directorate confiscated offices and assets linked to the scheme.

India has faced many cases of crypto scams in recent years. In June, an investigation was launched in Hyderabad into the Max crypto trading Ponzi scam, which defrauded at least 50 investors of $200,000.

In the same month, ED froze $3.83 million in cash and other assets belonging to online group Highrich, which was thought to be running a similar scheme in the name of crypto investments. The previous month, the agency responded to the “E-nugget” scam, which disguised itself as a gaming platform and collected more than $10 million from its victims.

India’s Financial Intelligence Unit had expressed concerns about the potential misuse of cryptocurrency exchanges for money laundering. Crypto-based service providers within the country are required to register with FIU-India and comply with the PMLA Act.