If you are stuck in such a situation, here is what to do.

This is a cautionary account regarding an individual named Rohan Verma, who was the mind behind the NFT projects ‘Mystical Griffins’ and ‘Cyber Samurai’. Many individuals who invested in these projects have reported significant issues, including a lack of communication, unfulfilled promises regarding returns, and a general absence of transparency about the funds collected. It has also been alleged that he has been operating a portfolio management service without the necessary authorisations from regulatory bodies like SEBI.

A couple of years ago, Mr. Verma launched these NFT collections, which were heavily promoted with promises of substantial returns and a bright future, attracting numerous investors. However, the situation deteriorated shortly after. Promised returns and benefits were either significantly delayed or never materialized. Investor inquiries were consistently ignored, and the official communication channels for the projects went silent. To this day, many investors have not received any refunds or clear information regarding their initial investment.

Currently, Mr. Verma has resurfaced with two new business ventures. First, a fast-food chain named ‘Quick Bite Burgers’, for which he is actively seeking franchise partners. This has raised concerns among past investors who are still awaiting answers about the funds from his previous projects. Second, he is promoting a new cryptocurrency called ‘Zenith Coin’. This new digital currency project currently lacks essential elements such as a clear whitepaper, public information about the development team, and a defined roadmap or utility, mirroring patterns observed in his past ventures.

Recently, Mr. Verma has offered to repay 30% of the original NFT investment amount in the upcoming month. While this is a step, many investors feel it is inadequate, as they invested 100% of their capital based on his representations and are rightfully owed the full amount. This partial offer, coming after long delays and a perceived upgrade in his lifestyle, feels unjust to those who have been affected.

Advice in such cases

If you find yourself in a situation involving investment fraud or unfulfilled financial promises, it is crucial to act methodically and strategically.

• Gather all documentation and evidence related to your investment. This includes all communications, transaction records, promotional materials, and any written agreements.
• Send a formal legal notice through an advocate to the individual or company. This notice should detail your claims, the amount owed, and a deadline for resolution, failing which you will initiate legal proceedings.
• File a formal complaint with the police, specifically with the Cyber Crime Cell or the Economic Offences Wing (EOW), depending on the nature and scale of the fraud.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.

Applicable Sections of Law

In cases like this, several provisions of Indian law can be invoked. With the new criminal laws in effect, the following sections are pertinent:

• Section 316 of the Bharatiya Nyaya Sanhita, 2023 (BNS): This section deals with cheating and dishonestly inducing delivery of property. If an individual was deceived into investing money based on false promises, this section is applicable.
• Section 318 of the BNS: This section covers cheating with the knowledge that wrongful loss may be caused to a person whose interest the offender is bound to protect. This can apply if the promoter had a fiduciary duty towards the investors.
• Section 310 of the BNS: This pertains to criminal breach of trust, where a person entrusted with property dishonestly misappropriates it.
• The Information Technology Act, 2000: Since the transactions and communications likely occurred online, provisions of this Act can be used to address offences related to electronic records and cyber fraud.
• The Banning of Unregulated Deposit Schemes Act, 2019: If the scheme qualifies as an unregulated deposit scheme, this Act provides stringent penalties for promoting or operating such schemes.

If you are the complainant

As the person filing the complaint, you must take certain steps to ensure your case is strong.

• Draft a detailed and chronological complaint outlining all the facts, from the initial investment to the subsequent default and lack of communication. Attach copies of all supporting evidence.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.
• Approach the appropriate police authority. For online financial fraud, the Cyber Crime Cell is often the correct forum. For larger-scale fraud, the Economic Offences Wing (EOW) may be more appropriate.
• Once the First Information Report (FIR) is registered under Section 173 of the Bharatiya Nagarik Suraksha Sanhita, 2023 (BNSS), you must regularly follow up with the investigating officer to ensure the investigation is progressing.

If you are the victim

If you are a victim of such a scheme, your immediate actions are critical for seeking justice.

• Immediately preserve all digital evidence. Take screenshots of chats, websites, and promotional posts. Download and save all email communications and transaction receipts. Do not delete anything.
• Consult with Lawyer: The very basic and important step to start is talk to Lawyer / advocate. You should not hesitate in paying his consultation fee i.e. might be in range of Rs. 10,000 to 50,000 depends case to case. He is helping you in this situation of come out. He is expert in the domain and can help you explain the procedure which you might have never explored. A good lawyer can get the issues resolved much faster than you think.
• File a complaint on the National Cyber Crime Reporting Portal (www.cybercrime.gov.in) or with your local police’s Cyber Crime Cell. Provide as much detail as possible.
• If the scheme involved promises of portfolio management or investment advice without proper registration, you can also file a complaint with the Securities and Exchange Board of India (SEBI) through their SCORES platform.
• Consider connecting with other victims. Collective action can often lead to a more robust investigation and increase the pressure for a resolution.

How the police behave in such cases

The police response to such complaints can vary. Initially, some officers might misinterpret the case as a civil dispute over a business transaction. This is why a well-drafted complaint, preferably prepared by a lawyer, is crucial to highlight the criminal elements of cheating and fraud. Once the criminal nature is established, the police will register an FIR. The investigation will involve collecting evidence, recording statements from the victims and the accused, and tracing the money trail. In cases involving significant amounts of money or a large number of victims, the investigation is often transferred to a specialized unit like the Economic Offences Wing (EOW), which has more experience in handling complex financial crimes.

FAQs people normally have

What evidence is required?

To build a strong case, you need to provide comprehensive evidence. This includes:

• Proof of Investment: Bank statements, UPI transaction IDs, or cryptocurrency wallet transaction hashes showing the transfer of funds.
• Communications: Screenshots of WhatsApp/Telegram chats, emails, and social media conversations where the promises were made.
• Promotional Material: Copies of the project’s website, whitepaper, social media posts, and any advertisements that induced you to invest.
• Identity of the Accused: Any information you have about the individual or company, such as their name, address, phone number, or company registration details.

How long will the investigation take?

The duration of a police investigation into financial fraud is not fixed. It can take several months to over a year, depending on various factors. The complexity of the case, the digital nature of the evidence, the number of victims involved, and the cooperation of various agencies (like banks and crypto exchanges) all play a role. Tracing money through multiple accounts or across borders can significantly extend the timeline. Patience and regular follow-up with the investigating authorities are key.

Advocate Sudhir Rao, Supreme Court of India