Narcotics Department’s official held for misappropriation of Bitcoins worth Rs 3.5 crores

A recent news came in from Ahemdabad, Gujrat involving misappropriation of 470 Bitcoins. An official from Narcotics Control Bureau is accused of illegally accessing  Freezed Bitcoin wallet. The NCB  busted a drug smuggling gang last year which used to sell psychotropic drugs to US based customers and in return were payed in form of Bitcoins.

The gang was arrested and their Bitcoin wallet was freezed by the NCB official Satyender Singh, last year in June 2015. The gang was released on bail from the Gujrat high court this year. What comes to be a surprise is that when the NCB looked on the freezed bitcoin account, NCB learned that Satyendra Singh, the official who busted the case had issues a signed and stamped letter authorizing to unfreeze the Bitcoin wallet having around 3.5 crores worth of Bitcoin. The authorization was given on by Singh without any orders from the top level. In an internal inquiry, Singh was held liable of illegally accessing the Bitcoin wallet having 450 Bitcoins. The inquiry also revealed that Satyendra Singh had collaborated with the accused gang members to unfreeze the Bitcoin wallet and illegally access it. After accessing, the Bitcoins were transferred to another account and were cashed out. It is believed Singh got 50% of the value.

Previous case of fraud involving Bitcoins may have been registered with Police with in the country but this is case is believed to be the First Major Bitcoin Controversy in India.

At present, Reserve Bank of India (RBI), country’s apex bank had issued several warning earlier with respect to usage of Bitcoins, but  has not declared it as illegal tender. Legality of Bitcoins in India is still in question.

On April 21, the government officials will issue a verdict about legal status of Bitcoins in India. (Click here to read full article)

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