In a significant ruling, an anti-corruption court in Ahmedabad, India, has handed down life sentences to 14 individuals, including 11 police officers and a former Member of the Legislative Assembly (MLA) affiliated with the Bharatiya Janata Party (BJP), for their involvement in the 2018 kidnapping and extortion of 34 Bitcoin from businessman Shailesh Bhatt.
The case, which highlighted rampant corruption within local law enforcement, was presided over by Judge B. B. Jadav, who found the defendants guilty of multiple serious charges, including criminal conspiracy, kidnapping for ransom, illegal detention, and assault. Among those sentenced were Jagdish Patel, a former superintendent of police, and Nalin Kotadiya, the ex-BJP MLA from Amreli.
In addition to life imprisonment, the convicted officers were fined for breaches of the Prevention of Corruption Act, underscoring the misconduct endemic among public servants. The court’s statement after the verdict emphasised the necessity of stringent measures to combat widespread corruption: “Widespread corruption among public servants and private persons is required to be curbed with a strong hand.”
At the heart of the case is Shailesh Bhatt, who had recently regained a significant amount of Bitcoin following a business venture involving the now-defunct cryptocurrency platform, BitConnect. After the local criminals learned of Bhatt’s Bitcoin holdings, Kotadiya directed a conspiracy with the Amreli police to abduct him on February 11, 2018. Bhatt was taken to a farm, where he was beaten by the officers to extract information regarding his cryptocurrency.
Under duress, Bhatt disclosed that he had previously received 752 BTC, having sold 576 BTC for approximately AUD 7.6 million (USD 5 million). The kidnappers subsequently mandated that Bhatt transfer his remaining Bitcoin, along with USD 3.6 million (AUD 5.5 million). However, the arrangement fell through when the courier suspected a set-up and cancelled the delivery. In the end, Bhatt was coerced into selling 34 of his remaining Bitcoin, valued at around AUD 229,000 (USD 150,000 at the time).
Following the incident, Bhatt reported it to the Indian Home Ministry, prompting an investigation that led to charges against 15 individuals. The prosecution presented evidence from 173 witnesses during the trial, of which 92 later turned hostile. As a result, perjury notices were issued to 25 of these witnesses.
This case serves as a stark reminder of the intersection between law enforcement and criminality within India’s growing cryptocurrency landscape. It raises crucial questions about the integrity of those tasked with upholding the law and the protective measures needed for individuals dealing in this digital currency space.
As India intensifies its scrutiny of cryptocurrency, evidenced by recent actions against crypto-related frauds — including the seizure of AUD 190 million as part of the BitConnect Ponzi scheme investigation — this ruling may signal a critical shift towards a more robust regulatory framework in the crypto sector.
