Torres Fraud Case: ED Faces Setback As Thousands Of Untraceable Crypto Wallets, Layered Cash-To-Crypto Network
The Enforcement Directorate (ED) has uncovered a sophisticated international syndicate allegedly operated by absconding Ukrainian nationals involved in the Torres fraud case. According to the agency sources, the syndicate was meticulously designed to prevent investigative agencies from tracing the ultimate destination of the defrauded funds. The operation was carried out with high levels of secrecy and precision, officials said.
Sources within the ED revealed that Alpesh Khara, a 54-year-old hawala operator currently in judicial custody, has emerged as a key link in the financial web of the said international syndicate. To delve deeper into the flow of illicit proceeds, Khara’s financial records were shared with the Financial Intelligence Unit (FIU) to map the movement of funds, which were allegedly converted into USDT (Tether cryptocurrency). Over Rs 100 crore is suspected to have been laundered through multiple crypto wallets and transferred to the Ukrainian accused by Khara.
However, the ED's investigation faced a setback when the FIU’s probe revealed that, while Khara did have a cryptocurrency account, no transactions had ever been conducted through his wallet. Officials stated that the wallets used for laundering the proceeds were entirely different, numbering in the thousands, with no detailed information available about them. Tracking these wallets remains a significant challenge for the investigators.
Further investigation revealed that Khara did not directly handle the conversion of the fraudulent proceeds into cryptocurrency. Instead, he allegedly employed a layered network of handlers, intermediaries, and agents to move large volumes of cash without leaving a digital trail. This multi-tiered structure has made it much more difficult to trace the ultimate beneficiaries of the fraud.
The ED investigation revealed that Khara had created WhatsApp and Telegram groups to coordinate cash collection, transfer, and conversion. Through these groups, Khara sent encrypted messages to the staff at Torres Jewellery’s Dadar showroom, instructing them to hand over cash to his designated collection agents. Crores of rupees were collected at the showroom from investors who had been lured with promises of high returns. Following Khara’s encrypted instructions, cashiers verified a handover code before releasing the specified amounts to brokers and agents appointed by him.
According to the ED’s findings, the cash collected by intermediaries and middlemen was then routed to clients across the country who maintained USDT cryptocurrency in their crypto wallets. These clients, after receiving the cash, transferred equivalent amounts of USDT to foreign-based operatives, notably a Ukrainian fugitive identified as Olexandar Zapichenko alias Alex.
Investigations further revealed that Khara received a 2% commission from Alex. Investigators discovered that the laundering process involved no digital money trail, funds were physically exchanged, and third-party crypto handlers facilitated the transfer of illicit money internationally without leaving a trace. Khara's role in the digital asset movement remained concealed, avoiding allowing him to stay removed from the actual digital money trail. Crypto handlers, capable of transferring funds internationally without revealing identities, played a critical role in the laundering process.
Despite extensive digital forensic efforts by the ED and FIU, no solid transactional links could be established between Khara’s wallet and the scam proceeds. The ED's findings reveal a new trend in financial crimes: the conversion of physical cash into cryptocurrencies, which can be transferred cross-border with minimal traceability. This emerging method poses significant challenges to law enforcement agencies, as the physical nature of the transactions leaves little to no digital footprint.
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