ED Charges Raj Kundra with Money Laundering in ₹150 Crore Bitcoin Ponzi Probe
Mumbai, India
The Enforcement Directorate (ED) has filed a chargesheet against businessman Raj Kundra, husband of Bollywood actor Shilpa Shetty, accusing him of being the beneficial owner of 285 Bitcoins valued at ₹150.47 crore linked to the notorious GainBitcoin Ponzi scheme. The document, submitted to a special Prevention of Money Laundering Act (PMLA) court on September 26, 2025, alleges Kundra concealed evidence and failed to surrender the assets despite repeated demands since 2018.
The GainBitcoin Ponzi Scheme: A ₹6,600 Crore Fraud Exposed
The case traces back to one of India's largest cryptocurrency scams, the GainBitcoin Ponzi scheme, orchestrated by the late Amit Bhardwaj between 2015 and 2018. Operating through platforms like GainBitcoin, GBMiners, and GB21, the scheme lured over 8,000 investors—primarily from Delhi and Maharashtra—with promises of 10% monthly returns on Bitcoin mining investments. Investors collectively lost approximately ₹6,600 crore, equivalent to around 80,000 Bitcoins at the time, as promoters diverted funds into obscure digital wallets instead of legitimate mining operations.
FIRs were first registered by Delhi and Maharashtra police in 2017 against Bhardwaj, his brother Ajay Bhardwaj, father Mahender Bhardwaj, and associates including Vivek Bhardwaj and Simpy Bhardwaj under the Variable Tech Private Limited banner. The ED took over the money laundering investigation in 2018, attaching assets worth over ₹42.8 crore in prior actions related to the core scam. Bhardwaj, the alleged mastermind, died by suicide in 2022 amid mounting legal pressure, leaving a trail of unrecovered assets.
- Key Scam Statistics:
- Total defrauded amount: ₹6,600 crore from 8,000+ investors.
- Promised returns: 10% monthly via Bitcoin mining.
- Diverted assets: 80,000 Bitcoins hidden in anonymous wallets.
- FIR locations: Delhi and Maharashtra, 2017.
This background underscores how early cryptocurrency hype in India, fueled by Bitcoin's 2017 bull run, created fertile ground for fraud, with investors often lacking regulatory safeguards.
Raj Kundra's Alleged Role: From Mediator to Beneficial Owner
According to the ED's chargesheet, Kundra received the 285 Bitcoins in five tranches from Amit Bhardwaj in 2017, ostensibly to fund a Bitcoin mining farm in Ukraine. The transaction involved an Israeli associate, Shlomo Amouyal (referred to as "Tom" in statements), with Kundra claiming a 20% sweat equity as a mediator for facilitating a $5 million deal. However, the project never materialized, and Kundra retained the Bitcoins, now valued at ₹150.47 crore based on September 2025 market rates.
The ED dismisses Kundra's mediator defense as "untenable," citing a "Term Sheet" agreement directly between Kundra and Mahender Bhardwaj, contradicting claims of third-party involvement. "Thus, it can be safely concluded that the agreement was actually between Raj Kundra and Amit Bhardwaj (his father Mahender Bhardwaj) and the argument given by Kundra that he acted as a mere mediator is not tenable," the chargesheet states. Investigators highlight Kundra's precise recall of the tranche details after seven years as evidence of direct ownership.
Kundra was first questioned by the ED in June 2018 but has since failed to disclose wallet addresses for the Bitcoins, attributing the lapse to a damaged iPhone X. The agency views this as a "deliberate attempt to destroy evidence and conceal the proceeds of crime." The chargesheet also names Delhi-based businessman Rajesh Satija as a co-accused for his role in related transactions.
Evidence Concealment and Transactions with Shilpa Shetty
A core allegation is Kundra's alleged layering of proceeds to evade PMLA proceedings. The ED claims he conducted a "genuine transaction" with Shilpa Shetty at "far below market rate" involving the sale of five Juhu flats for ₹38 crore, without actual transfer of possession, to disguise illicit origins. "Kundra tried to frustrate the proceeding under PMLA by layering the proceeds of crime and projected the same as untainted," the document asserts.
In April 2024, the ED provisionally attached ₹98 crore in assets linked to the couple, including a Juhu flat in Shetty's name, a Pune bungalow, and equity shares in Viaan Industries Ltd., where both are promoters. Shetty's lawyer has denied any ₹15 crore transfer rumors, calling them "fake" and vowing to approach the Bombay High Court. Neither Kundra nor Shetty has issued public statements on the September 2025 chargesheet as of September 28.
Official Statements from the Enforcement Directorate
The ED's probe emphasizes Kundra's continued "possession and enjoyment" of the Bitcoins as proceeds of crime. "Despite multiple opportunities since 2018, Kundra has consistently failed to provide the wallet addresses where the 285 Bitcoins were transferred," the chargesheet notes, interpreting his iPhone explanation as evasion. The agency routed the cryptocurrency through obscure wallets to obscure fraudulent mining promises, per investigators.
The chargesheet, filed under Section 44 of the PMLA, seeks court cognizance to initiate trial proceedings. ED officials, speaking anonymously to The Hindu, described the case as a "milestone in recovering scam-tainted digital assets."
Expert Analysis: Crypto Regulation Gaps in India
Legal and financial experts view the Kundra case as emblematic of India's regulatory challenges in the cryptocurrency space. Dr. Anil Mathur, a crypto law specialist, notes, "Cases like this highlight the vulnerability of Indian investors. The government must clarify how it classifies crypto—whether as an asset, a security, or a currency. Without clarity, scams will flourish." India's crypto framework remains in a "grey zone," with a 30% tax on gains but no comprehensive oversight, enabling frauds like GainBitcoin to thrive.
Financial crime analyst Priya Sharma from a Mumbai-based think tank warns that unresolved high-value scams erode investor confidence: "When enforcement agencies fail to recover proceeds timely, it disincentivizes wider adoption." The case underscores systemic flaws in tracking large crypto transactions, with analysts calling for mandatory KYC on exchanges and blockchain forensics integration. As of September 2025, India hosts over 20 million crypto users, but fraud reports have surged 300% since 2020, per Chainalysis data.
- Broader Implications:
- Investor Sentiment: High-profile cases like this could trigger a 10-15% dip in retail crypto inflows, experts predict.
- Regulatory Push: May accelerate the Financial Intelligence Unit (FIU-India)'s virtual asset guidelines.
- Market Impact: Bitcoin prices hovered at ₹52 lakh per coin on September 27, unaffected short-term, but long-term volatility risks rise.
Local Impact: Bollywood and Investor Fallout in Maharashtra
In Maharashtra, where many GainBitcoin victims reside, the scam's ripples extend to everyday families who invested life savings. A 2023 victim support group in Pune reported over 500 affected households, with average losses of ₹5-10 lakh each. Kundra's celebrity status amplifies scrutiny on Bollywood's financial dealings, potentially affecting endorsement deals for Shetty.
Human interest stories emerge from victims like Mumbai retiree Ramesh Patel, who told NDTV, "We trusted the mining promise; now, seeing a film star involved feels like salt in the wound." The ED's actions have prompted local investor education drives by the Reserve Bank of India (RBI) in Mumbai, warning against unregulated schemes.
Conclusion:
The ED's chargesheet against Raj Kundra marks a pivotal escalation in the GainBitcoin probe, reinforcing accountability for laundering ₹150 crore in scam proceeds while exposing persistent gaps in India's crypto oversight. As the special PMLA court reviews the evidence, the case serves as a stark reminder of the human and financial toll of Ponzi frauds. With ongoing asset attachments and victim restitution efforts, authorities aim to deter future schemes, fostering a more secure digital economy as of September 28, 2025. The trial's outcome could shape regulatory reforms, urging investors to prioritize verified platforms amid rising crypto adoption.