Gang laundering money via illegal crypto trading on Telegram busted

Time of India

21-06-2025

Lucknow: A joint team of Lucknow police's cybercrime cell on Saturday busted a gang originally being run by Chinese nationals or their proxies through a Telegram channel. The gang was involved in duping people by transferring crores of rupees to mule accounts on the pretext of illegal 'crypto trading' using USDT (Tether).
Those arrested were identified as Satyam Tiwari, 21, from Lucknow, Diwakar Vikram Singh, 21, from Basti, Saksham Tiwari, 21, from Rae Bareli, Vinod Kumar, 24, from Gonda, Krish Shukla, 25, from Lucknow, Mohd. Shad, 31, from Barabanki, Laiq Ahmed, 32, from Gonda, currently in Lucknow, and Manish Jaiswal, 40, from Lucknow.
Police seized 16 mobile phones, two laptops, a tab, Rs 1.85 lakh in cash, three cheque books, one passbook, and four four-wheelers from the accused.
Additional DCP (crime) Vasanth Kumar said the gang opted for illegal crypto transactions via USDT (Tether) to mint money. In the last two months, an amount of around Rs 75-80 lakh was siphoned off through bank accounts on the pretext of 'crypto trading'. Kumar said that the investigation revealed the role of a foreign handlers' network as the entire operation was conducted through Telegram channels, which are primarily run by Chinese citizens or their proxies.
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"These handlers coordinate USDT (Tether) trades via the TRC-20 network, avoiding any legal crypto exchange. The communication is encrypted, alias-based, and usernames are changed frequently to conceal identities. The gang appointed Indian bank account holders (mule accounts) to stash the cash.
The local agents hire Indian nationals on a commission basis to use their bank accounts for high-value transactions.
The account holders are told that their accounts may be frozen after the transaction — indicating that they had prior knowledge of the crime and KYC was either evaded or fake documents were used for KYC.
The cash withdrawal (money pickup) was done on the day of the transaction. The agents working in India take the account holders to their respective banks. The higher amount is deposited through NEFT/RTGS/IMPS, and the entire amount is withdrawn in cash on the same day.
The mule account holders were given their 'cut' for the favour. Then they transfer cash to crypto dealers. The withdrawn cash amount is assigned to a crypto broker, who uses it through a broker who conducts decentralised 'peer-to-peer' (P2P) transactions using cash and USDT transfers via multiple decentralised wallets," said Kumar.
Since these wallets are free from KYC and regulation, they are used to hide illegal transactions.
After USDT is purchased, it is transferred via the TRC-20 network to the wallet addresses provided by Telegram channels.
Police said there are no invoices, valid exchange records, or tax compliance involved in the entire process, making it ideal for illicit money laundering and international transfers. During interrogation, the accused called themselves 'crypto traders'. However, they were unable to produce any valid documents like exchange ledger records, wallet KYC, GST invoice, and tax documents.
Police said to maintain privacy, these people use decentralised wallets, even at higher exchange rates than normal, as these wallets do not require identity verification (KYC) and cannot be easily tracked by law enforcement agencies. These wallets and exchanges are extremely difficult to trace as they are based on a global network and do not come under the jurisdiction of any one country. "This confirms that 'crypto trading' is only a cover to hide the source and destination of illegal funds," police said.