Crypto exchange WazirX has received 828 complaint requests from the United States Federal Bureau of Investigation (FBI), Interpol, among other international agencies, and Indian law enforcement agencies such as the National Investigation Agency (NIA), Enforcement Directorate (ED), and Central Bureau of Investigation (CBI).
The requests were received against a total of 10 million transactions during April-September 2022.
The exchange maintained its record of a 100 per cent compliance rate for all 828 requests received from Law Enforcement Agencies (LEA), said a report released by WazirX. The exchange on Monday released its third edition of the Transparency Report.
According to the report, only 0.008 per cent of all transactions during this period were reported/investigated by law enforcement agencies.
Out of 828 queries received, 764 were by Indian law enforcement agencies, whereas the foreign agencies made 64 requests.
The most number of requests came in from regulators and law enforcement agencies in Maharashtra, it said. Illegal fund transfers, crypto scams, cheating, and forgery were the most common types of crimes reported, resembling scams in the traditional financial sector.
Over 700 accounts were blocked during this period. The majority of them were due to requests that came in from users.
In its continued effort to provide transparency to users and safeguard their assets, it launched the third edition of the Transparency Report.
The report highlights the company's initiatives in boosting awareness about Web3, assisting law enforcement in identifying bad actors and implementing a full-proof onboarding process to ensure the security of users.
"We have also outlined some common trends observed in Crypto scams over this time period which users should be aware of," it said.
Some of the Indian and Foreign Law Enforcement Agencies that WazirX has worked with during this period are: the National Investigation Agency, Enforcement Directorate, State Cyber Crime Cells, Intelligence Fusion & Strategic Ops (IFSO) Delhi, Special Task Force, Narcotics Control Bureau, Bhopal Police, Crime Branch and CID, Toronto Police Department, Federal Bureau of Investigation (FBI), German Police Agencies, United Kingdom Police, Interpol, Dutch Police, Austrian Police, Europol, etc.
"We still have some way to go to prevent security risks in Crypto. The level of awareness around Crypto needs to extend to its ill uses too. Only then can mainstream adoption take place in an environment of trust. We will continue our efforts to educate Indians about Crypto, and comply with regulators to ensure any form of fraud with virtual digital assets is tackled," Nischal Shetty, CEO and Founder at WazirX.
According to the report, around 40 per cent of the scams are happening in Ponzi schemes and social engineering scams, 34.7 per cent of cases of Impersonation type, 21.1 per cent of cases are in Phishing / Airdrop Scams and 4.2 per cent are in other categories.
As per the report, in a recent case, a Bitcoin racket being run from Delhi came to the notice of the CBI on being alerted by the Austrian police. Imposters posed as Europol officers and other law enforcement agencies to tell their victims that their identities had been stolen and used for narcotics businesses. The criminals would target foreign nationals for the same. WazirX's legal team, with assistance from Chainalysis, collaborated with the CBI on this case to block the operation. They identified the accounts which were being used to carry on this racket and blocked the withdrawal of the assets that were gained from the criminal proceedings.
In one of the first disproportionate asset cases involving Crypto, WazirX helped Bhubaneswar Police identify the Crypto accounts of an engineer who did not reveal his investments in Digital Assets. Upon scrutiny by the team, it was discovered that he had 50-odd Crypto wallets and an investment worth Rs. 2 crores.
In another incident, the legal team assisted the Kolkata police in nabbing some criminals who were defrauding people through a mobile gaming platform. In this case, a large sum of money was collected from the public via the platform called e-nuggets. The culprits then disabled the withdrawal of money and also removed all data from the app. WazirX helped ED freeze crypto assets worth Rs 12.83 Crores.
A few months ago, a group of criminals from Ghaziabad, Uttar Pradesh, created an elaborate fake trading app to lure customers and dupe them of huge sums of money. WazirX assisted the Ghaziabad Police real-time in identifying the identities that were linked to the culprits which led to their arrest.
In Bandra, Mumbai, Maharashtra, the WazirX team helped identify wallets linked to Chinese loan apps which were used to dupe people through fraudulent transactions. The team worked closely with the law enforcement agency to identify the accused and block their operations using Crypto.
WazirX cooperated with the investigators by providing them with all the necessary details, information, and documents of the alleged accused companies who used the WazirX platform. After an in-depth internal investigation, WazirX noticed that most of the users whose information was sought by ED were already identified as suspicious by WazirX internally and were blocked in 2020-2021. Due to the active cooperation extended by WazirX and active Anti-money laundering (AML) checks, suspected users were identified.
WazirX also modified the procedure to raise a Law Enforcement request. To submit a Law Enforcement request under relevant provisions of law, the requester must be a law enforcement agent or government official authorized to Gather evidence in connection with an investigation or Make a formal law enforcement request. T
They can send an email to email@example.com from the official email ID of the law enforcement agency along with a duly authorized written request.
WazirX has continued its association with TRM Labs, a virtual digital asset compliance platform, to sustain and scale up its efforts of security. It also collaborated with Chainalysis, a platform to analyze blockchain data. WazirX also joined hands with other industry players in the country to form a new crypto advocacy group called Bharat Web3 Association (BWA).
WazirX launched a course on Blockchain Technology to educate individuals. This was in collaboration with Gurukula Kangri in Haridwar, a deemed-to-be university, as per the University Grants Commission (UGC). Since its initiation, the course has seen more than 20,000 enrolments. We recently awarded the completion certificate to over 400 individuals. 7.4 per cent of them were females. Uttar Pradesh saw the highest number of enrolments in the program (25.4 per cent) among all participating states.
(Except for the headline, this story has not been edited by NDTV staff and is published from a syndicated feed.)