Delhi High Court denies bail to cryptocurrency scam accused citing economic implications

New Delhi: Delhi High Court on Monday highlighted that dealings in cryptocurrency have profound implications on the country's economy by way of "dissolution of recognised money into the dark, unknown and untraceable money".

Denying bail to a man accused of running a cryptocurrency-based scam, the court noted that a huge number of people had been defrauded.

"The allegations against the accused in this multi-victim scam are quite serious, more so in light of his antecedents of involvement in as many as 13 more cases of similar nature," Justice Girish Kathpalia observed, rejecting the bail plea of the businessman in a cheating case related to cryptocurrency.

Umesh Verma was arrested in Dec 2020 and was currently out on interim bail in the matter. The court directed Verma, accused in the case against the Dubai-based cryptocurrency company, Pluto Exchange, to surrender before the investigating officer or the trial court.

In its order, the court said his act of collecting money even after the de-recognition of cryptocurrency showed mala fide action. It pointed out that the accused is alleged to have duped 61 investors after "painting a rosy picture" of getting them returns of 20-30% on their investments in cryptocurrency, a process which he continued against the gullible people even after the de-recognition of cryptocurrency.

"The deep pockets of the accused, coupled with the nature and expanse of the offence in the present case and 13 more cases with the consequential possibility of long incarceration, lend credence to the apprehension of prosecution that the accused is a flight risk," the judge added.

The court underlined multiple factors that convinced it to deny bail to Verma, such as the complexity and expanse of the economic crime alleged against him, the continuance of collection of investments in the business of cryptocurrency by Verma from credulous investors, "swayed by the mirage of 20% to 30% profit assured by the accused/applicant, despite the de-recognition of cryptocurrency; blatant misuse of the mediation system by the accused/applicant by alluring execution of mediation settlements and not complying with the same despite adjournments across more than two years before the predecessor benches."

The court also noted that the accused was a "serious flight risk" and the probe against him is still on, with more and more victims coming to light.