SIT cites non-cooperation of police officer arrested in Karnataka Bitcoin scam case, opposes bail

During the bail arguments on Friday, the SIT told a sessions court that the DSP rank officer had not cooperated in the investigation but instead tried to school the investigators on conducting the probe and reportedly stone walled the questioning.

The DSP and other police officers, who were a part of the Central Crime Branch unit of the Bengaluru police in the 2020-21 period, are accused of tampering with evidence in the form of two laptops that were seized from international hacker Srikrishna Ramesh alias Sriki after his arrest in November 2020 by a CCB team led by Pujar.

The SIT is investigating whether the police officers siphoned off Bitcoin worth Rs 850 crore that were reportedly accessible to the hacker at the time of his arrest.

During the bail hearing on Friday, the SIT told the court that Pujar had failed to explain during his custodial interrogation as to why the laptops seized between November 17 to November 19 of 2020 from the hacker by the police were found to have been illegally accessed even after they were secured by the police.

The SIT filed a case of destruction of documents and cheating against unnamed officers of the Bengaluru Central Crime Branch police on August 8, 2023 in connection with alleged manipulation of electronic devices seized from Sriki and his associates.

The SIT quoted a digital forensics report from the state forensic science lab dated February 20, 2023, to state that an Apple MacBook and a hard disk seized on November 17, 2020, by the police was found to have been tampered between November 18 and 20. A second MacBook seized on November 19, 2020, was tampered between November 20 and 21, it is alleged.

The SIT also referred to voluntary statements of Sriki and two technical experts who were witnesses to suggest that CCB police officers facilitated the illegal accessing of crypto wallets containing crypto currency to the tune of Rs 850 crore belonging to Sriki following his arrest in November 2020.

Citing a CDAC forensic report for the laptops seized from the hacker and statements of witnesses, the SIT has alleged that as many as 4,000 Bitcoin valued at Rs 850 crore in 2020 was probably accessed illegally by police officers after the hacker’s arrest.

A CDAC report dated January 23, 2024 has stated that one of the laptops seized from Sriki on November 17, 2020, was used to access crypto wallets at cryptocurrency web-sites and for accessing online gaming platforms while it was in police custody.

The report also indicated the finding on the use of anonymizing tools in a deliberate effort to conceal online activities, data manipulation, transfer of files to external devices, and deletion of history — which amounts to tampering of digital evidence, the SIT has reported.

The counsel for the police officer argued that he was being forced to reveal the names of persons in higher positions who orchestrated the activities of the CCB when the hacker was arrested. The counsel said that senior police officers of the rank of DCP and Joint Commissioner, who were supervising the probe in 2020, had not been questioned by the SIT.

The court posted the matter for orders on October 29. Earlier on September 23, the Karnataka High Court had rejected the anticipatory bail plea of Pujar.

“The allegations made against the petitioner and the co-accused shocks the conscience of the Court as well as the general public, where it is alleged that the petitioner and other police officers who hold high posts in the criminal justice system have stooped to such a level of tampering the documents with the help of the accused in the case,” the High Court observed.

The court said that “a detailed investigation is very much necessary to unearth true facts”.

“If the petitioner is innocent and if baseless allegations are made against him as contended, he will come out clean after investigation. But at this stage, the materials on record create a cloud of doubt on the conduct of the petitioner,” it added in the September 23 order.

Background of the case

The CID SIT was constituted by the Congress government in June 2023 to probe the alleged Bitcoin scam from the tenure of the BJP government (2019-2023) where cryptocurrency worth crores – allegedly stolen by the hacker from international exchanges and gaming sites — were in turn siphoned off by the police and politicians after the hacker’s arrest in 2020.

Sriki is accused of multiple hacking crimes in India too, including extortion of gaming sites like Poker Baazi in 2020, the theft of Rs 11.5 crore from the Karnataka e-procurement portal in 2019 and 60.6 Bitcoin worth Rs 1.64 crore in 2017 from the Unocoin cryptocurrency exchange in Karnataka.

Sriki and his accountant Robin Khandelwal were initially arrested by the Bengaluru crime branch in November 2020 on charges of buying drugs online using Bitcoin.

The case involving the purchase of drugs on the darknet eventually led to the cracking of several cybercrimes in Karnataka – involving the then 26-year-old hacker Srikrishna Ramesh – including a Rs 11.5 crore heist from the state e-procurement portal in 2019.

The handling of the cases involving the hacker by the police under the BJP regime in Karnataka after the arrests in November 2020 resulted in allegations of corruption by the Congress when it was in opposition between 2020-2023.

There are allegations of police officials grabbing a large cache of Bitcoin that was found in the crypto wallets of Sriki after his arrest in November 2020.

After the SIT was constituted, two new FIRs were filed in August 2023 and January 2024 with respect to the tampering of evidence and alleged illegal confinement of the hacker and his associate by the police in 2020-21.

Apart from Pujar, the SIT has arrested three former Bengaluru crime branch police officers – Prashanth Babu, Chandradhar S R and Lakshmikanthaiah in the two cases filed after it took over the probe in 2023. The other officers have been granted bail by the courts.