Yesterday, On 27th June, The Karnataka High Court questioned why senior police officers are not under investigation in the Bitcoin scam, while granting bail to a DSP-rank officer. The additional Special Public Prosecutor informed the Court that police officers were involved in the disappearance of 31 Bitcoins, valued at Rs 9 crore in 2021. These Bitcoins reportedly seized from a hacker on January 8, 2021, through a mahazar process.
Bengaluru: The Karnataka High Court recently questioned why a senior police officer has not been named in the Bitcoin scam investigation by the state’s CID Special Investigation Team. This concern raised while granting anticipatory bail to a police officer accused of embezzling Bitcoin from a detained international hacker.
On Thursday, the Karnataka HC granted anticipatory bail to Shridhar Pujar, a deputy superintendent of police, who, along with three other officers, accused of illegally detaining hacker Srikrishna Ramesh alias Sriki, 29, after his arrest in November 2020. The officers also alleged to have provided the hacker with unauthorized access to devices.
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After being informed that the joint commissioner of police was part of a WhatsApp group of officers discussing efforts to appropriate Bitcoins from the hacker. In its order granting anticipatory bail to Deputy SP Pujar, the HC observed,
“There is no explanation as to why the joint commissioner is not made an accused in the present case,”
During Thursday’s arguments in the Karnataka High Court, the additional special public prosecutor (SPP) revealed that the case against four former Bengaluru central crime branch police officers primarily involved the theft of Bitcoins from an arrested hacker by manipulating the records of cases registered against him and his associates in 2020.
The additional SPP informed the Court that the officers facilitated the disappearance of 31 Bitcoins, valued at Rs 9 crore in 2021, which purportedly seized from the hacker on January 8, 2021, through a mahazar process.
Furthermore, the additional SPP disclosed that the Special Investigation Team (SIT) uncovered records from a police WhatsApp group called ‘Hacking Group’ on one of the accused officer’s phones. This group contained discussions on efforts to illicitly obtain Bitcoin from the arrested hacker using the multiple hacking cases filed against him.
The prosecution and Shridhar Pujar’s counsel informed the HC that the then joint commissioner of police (crime) for Bengaluru city and the deputy commissioner of police (crime) members of the WhatsApp group where the alleged conspiracy was planned.
The HC observed,
“There is no explanation as to why the joint commissioner is not made an accused in the present case,”
The Karnataka High Court observed in its order on Thursday,
“The additional SPP submitted that there was a WhatsApp group, of which the petitioner was also a member, where the investigating officers of various criminal cases involving Srikrishna alias Sriki were active. The text messages disclosed that the investigating officers, including accused numbers 2 to 5 in the present case, were actively involved in the alleged misappropriation.”
The HC further noted,
“However, it is pertinent to state that admittedly the joint commissioner of police is also a member of the group. He, being a superior officer, was an active member of the WhatsApp group, and whatever chatting was done by the petitioner and other investigators was under the very nose of a superior officer like the joint commissioner.”
The Court added,
“There is no explanation as to why the joint commissioner is not made an accused in the present case.”
Additionally, the HC referenced a press note issued by the Bengaluru city police commissioner on November 13, 2021, which stated that there had been no misappropriation of the 31 seized Bitcoins and that the hacker misled the police into believing he possessed the 31 Bitcoins.
The High Court stated,
“The SPP pointed out that the circumstances under which the press note was released by the office of the commissioner of police of Bengaluru city need to be unearthed by investigating the matter. The fact remains that the press note was issued on 13/11/2021, and to date, no explanation or corrigendum has been issued.”
The HC judge, while granting conditional anticipatory bail to Deputy SP Shridhar Pujar, ruled,
“Under these circumstances, I have serious doubts about serious lapses in the investigation undertaken by the investigating officer in the present case. However, I do not find any justifiable reason to subject the petitioner to custodial interrogation.”
The additional SPP informed the HC that the joint commissioner of police (crime) is being investigated by the SIT based on emerging evidence.
The SIT also questioned a former head of the crime branch, Sandeep Patil, an IPS officer, on two occasions. He supervised the Bengaluru central crime branch during the 2020-21 period when the alleged Bitcoin scam occurred.
Earlier, on May 24, the Supreme Court stayed a May 2 order by the Karnataka High Court, which granted virtual anticipatory bail to Deputy SP Shridhar Pujar in the Bitcoin scam case.
The Special Investigation Team (SIT) approached the Supreme Court on May 15 after the HC, on May 2, ordered the release of Pujar on a surety of Rs 2 lakh after a day of questioning, despite the officer not seeking bail in his petition to the HC.
Deputy SP Shridhar Pujar, a former Bengaluru crime branch inspector, and three of his former crime branch colleagues are among four police officers named by the SIT, along with a cyber expert, in an FIR alleging illegal confinement, breach of trust by a public servant, and destruction of evidence. This FIR was filed on January 24, 2024, in connection with the crime branch’s handling of cases following the arrest of hacker Srikrishna alias Sriki in November 2020.
Srikrishna, 29, arrested again by the SIT on May 6 this year concerning the June 2017 theft of 60.6 Bitcoins, valued at Rs 1.14 crore in 2017, from a cryptocurrency exchange in Tumkur, Karnataka, which was not prosecuted by the crime branch in 2020. The four former crime branch officers accused of wrongdoing in the 2020 cases against the hacker are Shridhar Pujar (now a deputy SP), inspectors Prashanth Babu, Chandradhar S R, and Lakshmikanthaiah, along with private cyber expert K S Santhosh Kumar, who assisted the probe in the hacker’s case in 2020.
Investigations into the case have revealed numerous procedural lapses by the CCB in its probe against the hacker and his associates, including illegal detention and a lack of documentation of logins, among other issues.
The handling of the hacker cases by the police under the BJP regime in Karnataka, after the arrests in November 2020, led to allegations of corruption by the Congress when it was in opposition between 2020-2023.
The Congress government, after coming to power, constituted the SIT on June 30, 2023, to probe the Bitcoin scam. Hacker Sriki stated in police records and charge sheets filed by the crime branch that he was forced to hand over all cryptocurrency in his possession to the police while in custody between November 2020 and January 2021.