The Enforcement Directorate (ED) apprehended Nikunj Pravinbhai Bhatt (33) and Sanjay Kotadia (49) in connection with a significant cryptocurrency fraud related to the BitConnectCoin scam. The arrests, made on January 19 under the Prevention of Money Laundering Act (PMLA), followed an investigation into fraudulent cryptocurrency investments and money laundering activities.
Both accused individuals appeared before the Special PMLA Court in Ahmedabad on January 20, where the ED was granted four days of custodial remand. The ED’s probe was initiated based on two FIRs filed by the CID Crime Police Station, Surat, against Shailesh Babulal Bhatt, Satish Kumbhani, and others.
The agency alleged that the accused generated proceeds of crime by enticing the public to invest in BitConnectCoin through a “Lending Programme” controlled by Kumbhani and associates. Between November 2016 and January 2018, the accused conducted fraudulent offerings of cryptocurrencies under the guise of investments in BitConnect’s lending scheme.
Investors, both domestic and international, were promised unusually high returns of up to 40% per month through a claimed proprietary “volatility software trading bot.” The ED discovered that investor funds were not used for trading as claimed but were diverted for personal gain by transferring funds to digital wallets controlled by the accused.
During searches on January 9, 2026, the ED conducted operations at five locations, seizing digital devices and incriminating documents. Assets including investments in shares, mutual funds, cryptocurrencies, and cash totaling around Rs 19 crore were frozen. The investigation also revealed Nikunj Bhatt’s involvement in a separate crime related to kidnapping and extorting cryptocurrencies and cash.
