Kunjathbail Mujib Sayyad, a resident of Mangalore, Karnataka, has been arrested by law enforcement in Hyderabad for defrauding over 50 people in a cryptocurrency ponzi scheme. The investigation into the “Max Crypto trading” ponzi scheme was initiated in late 2022, after victims alleged that Sayyad and his accomplices promised lucrative returns on investments through an Android application called the MAX App. The scam promised returns within 150 days and offered a commission for every new investor brought in by existing users. The group claimed to be connected with big cryptocurrency traders and misled investors by stating they were based in Ajman, UAE.
Despite hosting local events to promote their scheme, the scam operated entirely online without any physical offices in India. Victims reported that initially, the scheme paid out returns in US dollars to gain credibility. However, the company and its app vanished within the first 50 days of launch, leaving investors empty-handed. With a total accumulation of INR 1.66 crore (approx. $200,000) from 52 victims, the case was registered by local police and handled by the Economic Offences Wing of the Cyberabad police.
Currently, Sayyad is facing charges under various sections of the Indian Penal Code for cheating, criminal breach of trust, and conspiracy, while his accomplices remain at large. Ponzi schemes like these are common in countries like India, where scammers exploit the lack of understanding and hype around cryptocurrencies. In a similar case, India’s Enforcement Directorate froze $180 million worth of assets from an investment group accused of running a ponzi scheme, and charged 299 entities for operating a fraudulent cryptocurrency mining investment firm. This highlights the need for vigilance and regulatory oversight in the crypto space to protect investors from falling victim to such scams.
In this digital age, where investment opportunities in cryptocurrencies are on the rise, it is essential for investors to exercise caution and conduct thorough due diligence before committing their funds. Scams like the “Max Crypto trading” ponzi scheme serve as a stark reminder of the risks involved in the digital assets market. By being aware of common tactics used by fraudsters, such as promising high returns and offering lucrative commissions for recruiting new investors, individuals can protect themselves from falling prey to such schemes. Additionally, regulatory bodies must step up their efforts to monitor and crackdown on fraudulent activities in the crypto space to safeguard the interests of investors.
As the popularity of cryptocurrencies continues to grow, so does the prevalence of scams and fraudulent schemes targeting unsuspecting investors. It is imperative for individuals to educate themselves about the risks associated with investing in cryptocurrencies and to exercise caution when presented with seemingly attractive investment opportunities. By staying informed and remaining vigilant, investors can protect themselves from falling victim to fraudulent schemes like the “Max Crypto trading” ponzi. Collaborative efforts between law enforcement agencies, regulatory bodies, and the public are necessary to curb the proliferation of such scams and maintain the integrity of the crypto market for legitimate investors.
