Bitcoin `scam': court says there is sufficient material to proceed against Raj Kundra

Mumbai, Jan 7 (PTI) There is sufficient prima facie material to proceed against businessman Raj Kundra for offences punishable under the Prevention of Money Laundering Act (PMLA), a special court here has held while issuing him a summons in an alleged bitcoin scam.

R B Rote, special judge for PMLA cases, on Monday issued a summons to Kundra and Dubai-based businessman Rajesh Satija, asking them to appear on January 19.

The duo were added as accused in a supplementary charge sheet filed by the federal probe agency in September last year.

In the reasoned order, made available on Wednesday, the court stated that the statements of witnesses, prosecution complaint (charge sheet) and the record of the case "prima-facie show" that Kundra and Satija were involved in offences punishable under the PMLA.

"There is sufficient material to proceed against accused Nos 17 and 18 (Kundra and Satija)....The ED has made out a prima-facie case to take cognizance...and issue process against them," the court said.

Kundra, the agency alleged, received 285 Bitcoins from the "mastermind" and promoter of Gain Bitcoin Ponzi "scam" Amit Bhardwaj for setting up a Bitcoin mining farm in Ukraine.

Since the deal did not materialise, Kundra is still in possession of 285 Bitcoins presently valued at more than Rs 150 crore, the ED claimed.

The charge sheet stated that Kundra claimed to have acted as a mediator in the said transaction but didn't provide "any underlying documentary evidence to prove the same".

On the contrary, the agreement titled "Term Sheet" was signed between him and Mahendra Bhardwaj, it said.

"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 charge sheet said.

The fact that Kundra remembers the exact number of Bitcoins received in five specific tranches for more than seven years since the transactions took place "solidifies the fact that he was indeed the recipient of Bitcoins as a beneficial owner and not acted merely as a mediator," it claimed.

The probe agency has also alleged that despite multiple opportunities since 2018, Kundra has consistently failed to provide the wallet addresses where the 285 Bitcoins were transferred.

He cited damage to his iPhone X as the reason for the missing information, which the ED viewed as a deliberate attempt to destroy evidence and conceal the proceeds of crime, it added. PTI AVI KRK