ED Cracks Down on $1.9M Crypto Scam Linked to Bollywood, Luxury Expenses

The Directorate of Enforcement (ED) has arrested two key figures in a massive cryptocurrency scam that raised Rs 146 crore from investors. Syed Usman, also known as Babu, and Dhamodharan Balachandran were taken into custody on September 22, 2026, under the Prevention of Money Laundering Act (PMLA). The ED investigation is linked to the Hashpe cryptocurrency fraud, which involved an investment scheme called TCX.

The accused, Usman and Dhamodharan, set up an investment platform that promised substantial returns through a supposed cryptocurrency. They lured investors with promises of high returns and used referral commissions, social media promotion, and a launch event on a cruise ship in Mumbai to attract more investors.

According to the ED, Rs 16 crore was obtained in cash as part of the proceeds of crime, while Rs 10.52 crore was credited to a bank account under the name of Hify Circle. The remaining amount of Rs 120 crore was invested in TCX coins. The funds were then channelled into private bank accounts of Usman and Dhamodharan, their families, and associated organisations.

The ED conducted searches at 11 locations in Chennai, Coimbatore, and Kolkata on September 1, 2026, and found that the accused used the money to buy cars for investors, pay for appearances by Bollywood celebrities, organise cruises, and fund other luxurious personal expenses.