Solar Techno Alliance Crypto Scam: The Promise Of A Ponzi Scheme In Odisha

He invested ₹5,000 and then another ₹1 lakh in STA by taking a personal loan from the bank. Within three months, Nayak received a notice from the bank for not paying equal monthly installments (EMIs) on time.

Solartechnoalliance.com, the group's website that is still active although registration has been suspended, describes the STA token as a "multi-utility decentralized token that can be used in all industrial services," without elaborating. This statement does not refer to the founders or key stakeholders; There are many grammatical and typographical errors and revenue reports exceed $1 trillion.

For Laha and Nayak, untrained in complex technical operations and trained in Odia, the danger signs were not detected. The MLM aspect of the program is also not detailed on the website. In the weekly meetings at Bhadrak and elsewhere, all preaching was done orally. Investors who add more people to the network will receive iPhones and two wheels from "successful winners," according to the EOW.

“I only lost ₹10,000 on STA,” says Laha. "But thousands of people, mostly small entrepreneurs, invested thousands of dollars." A friend of Naik's, a migrant worker from Tihid, had returned from Surat, where he had worked in a cotton mill during the COVID-19 pandemic. Like him, Nayak said, he also took a bank loan of Rs 1 lakh to try his luck at STA.

The year is 2021. People who have lost their jobs and returned to their villages are desperate for money and stability, and STA is seen as a place to escape from these dark times.

Gurtej Singh Sidhu, Head of STA India (left), at a private event with Hungarian national David Gage, Group CEO. | Photo: Custom arrangements

Money stuck

In July this year, the EOW received information about crypto tokens linked to Das, a businessman in Bhadrak. Bhadrak and Balasore districts are centers of Provident Funds that dispossess some people experiencing economic hardship. The sign is thought to be a cover for a Ponzi scheme. The EOW visited Deputy Superintendent of Police Sasmita Sahu and Inspector Bhadrak posing as potential investors and approached the accused posing as employees of the NGO.

This "NGO worker" explained that people should download the STA Trust Wallet app (which is no longer on Google Play). After verifying their credentials, the app will create an account in their name. A minimum "investment" of ₹3,000 is required to get started.

The EOW's initial investigation revealed that the "investors" were given this impression thanks to active surveillance by STA executives, who held regular Zoom meetings with them. Sometimes Sidhu, the director of STA India, and David Gage, the 33-year-old Hungarian CEO, attend these meetings to instill investor confidence.

Investors will be promised daily returns of 3-5% on their deposits with a lock-in period of 20 months. Sahu said the main goal is to attract new investments through referral links, which can be earned through referral bonuses. "Ponzi schemes work like pyramid schemes, where companies that move early gain an advantage over companies that move later, which eventually leads to collapse as the value of tokens decreases," he said.

The EOW registered a case under the Odisha Protection of Depositors (Financial Institutions) Amendment Act, 2016, naming Gage, Sidhu and Das in the FIR on July 28, based on preliminary findings.

STA India Chairman Gurtej Singh Sidhu with actor Govinda at a private group event. | Photo: Custom arrangements

Countdown and conclusion

The STA meeting at a hotel in Goa on July 31, attended by actor Govinda and hundreds of high-ranking members, raised the alarm of the EOW. The meeting aims to launch the group's blockchain system, which will allow it to move away from tokens and launch its own cryptocurrency.

Cryptocurrency transactions come in two forms: An organization can trade cryptocurrencies if it has its own blockchain system, which consists of a network of computers. If an entity trusts someone else's system, it is called a token. Tokens are relatively easy to create and can be listed on exchanges for trading. Tokens are often considered a precursor to currency.

However, according to EOW, the value of STA tokens has started to decline. Investors started withdrawing their funds, showing a sense of panic in various WhatsApp groups created by STA members. These groups are given advice to avoid panic. The EOW then joined many WhatsApp groups.

Realizing the importance of the July 31 event as an opportunity to meet the senior management of STA, the EOW team visited Goa. It was later revealed that 1.5 crore donated by senior members was spent on the event, including accommodation in luxury hotels and a yacht, a portion of which was earmarked for star Govinda.

Sidhu notices his presence as the EOW team waits outside the room. He fled to Mumbai, then to New Delhi, traveled to Punjab by road and finally reached Sri Ganganagar in Rajasthan on the Punjab border. The EOW traced him and found the hotel where he was staying. Sidhu was arrested at 11:45 am on August 4 with the help of two members of EOW and Rajasthan Police. He was produced in a Cuttack court on August 6. Das was arrested the same day and was found to have transferred Rs 30 crore through his bank account.

People visited the Special Task Force and Economic Affairs office in Bhubaneswar to air their grievances. | Photo: Biswaranjan Raut

Contact tracing

EOW officials said Sidhu first contacted Gage through Facebook. They joined others from Amsterdam to start the project. “We got some interesting information from Sidhu's mobile. He kept his main phone numbers with names ending in MLM,” Sahu said.

During investigation, the EOW found that Sidhu belonged to a farmer's family and was not above Class IV. He had a strained relationship with his parents and did odd jobs, including repairing tires and pipes, in Faridkot, Punjab, where he grew up. One day, to improve his finances, Sidhu joined Amway, a network marketing company that sold products ranging from nutritional supplements to frying pans.

His family, including his wife, 19-year-old daughter, and 12-year-old son, lives a prosperous life in Punjab with the income from STA. The organization creates a hierarchical revenue board within the network. Inci members get guaranteed earnings of $1.50 per day, while Kohinur members earn daily rewards ranging from $2,500 to $3,000. Other plates include Ruby, Emerald, Topaz, Diamond, Pink Diamond, Blue Diamond and Hope Diamond, police said.

Sidhu is the only member of Kohinoor. She was photographed arriving at the meeting in an open car while people showered her with flowers. He paid a small sum of money to Gage, who worked as a hotel waiter. Investigators believe the size coming from abroad helped boost confidence among potential investors.

When the STA was launched, Sidhu used a major messaging service to send messages, the EOW found. The interviewee becomes a senior leader in the team, playing a role at the top of the pyramid structure. They are responsible for expanding the network.

Sarvajit Kumar, who runs a photography and videography shop in Sariranjan in Samastipur district, Bihar. | Photo: Custom arrangements

CONVERSATION

After Sidhu's arrest, victims started approaching the EOW to get their money. Sarabjit Kumar, who runs a photography and videography shop covering weddings in Bihar's Sastipur district, said he invested Rs 20,000 in STA in March this year. “My online members asked me to invest more to increase my income. I took a loan of 2.2 million lek in my wife's name, kept 1.2 million lek in the scheme and spent the rest on family expenses," he said.

Kumar's cousin, who runs an agricultural produce shop in Sararanjan area, invested ₹9 lakh. Investigators also found that a retired teacher from Bhadrak district had invested all his savings in the scheme.

Initially, EOW investigators estimated that there were around 10,000 victims in Odisha, but now the number has reached 21,000. Bhadrak and Balasore districts were worst affected. STA victims are spread across different states, with a large number of investors coming from Bihar, Rajasthan, West Bengal and Punjab. According to investigators, the group also has members in Hungary, Saudi Arabia and Nepal.

While getting their money back still seems elusive, victims are hoping for justice. "Without significant activity, the association continues to attract new members and collect savings. This alone can be a sufficient basis for imposing punishment under the Money Laundering Taxes and Schemes (Prohibition) Act, 1978,” said Jai Narayan Pankaj, a senior Odisha cadre IPS officer who heads the EOW.

The police intend to file a case under Section 420 (cheating) of the Indian Penal Code and the Information Technology (Amendment) Act, 2008 to ensure strict punishment.

“Most of the funds raised are in the form of STA tokens. We have approached the cryptocurrency trading platform Binance, which is said to have 21 crore STA cryptocurrencies. Unfortunately, they are yet to respond to our request,” said a Pankaj adding that they are yet to respond to our request. exploring alternative routes. "When these funds are converted from tokens to real currency, they cannot be credited to personal accounts. A Mule account can be used instead. Almost all cyber frauds avoid personal accounts and use mule accounts,” said the EOW chairman, who led the team that unearthed several loan scheme scams.

Fraudulent funds are usually transferred from one mule account to another and ultimately end up in an account linked to the shell company. These shell companies partner with cryptocurrency traders to convert funds into cryptocurrency. Once the cryptocurrency is transferred to China or another foreign country, it is almost impossible to get the money back. ক্র্তাদ্ব English English is not.

Pankaj said, “We have reported this shell company to the enforcement authorities including the Reserve Bank of India. EOW टीम अक्तर गुबिंडेर साक्ष঍तरकाआई नेर प्रकृत्र बुद्धाँवादु. They expect to meet celebrities online.

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