Nagpur: The Nagpur Police have dismantled a sophisticated multi-level digital coin scam that defrauded thousands of gullible investors across the country of over Rs 15 crore. The fraudulent schemes, named 'Free Coin' and 'Merchant Coin', lured victims with promises of high returns.
Arrests and Seizures
Two prime accused have been arrested: Mehul Dixit from Nagpur and Rakesh Garg alias Rakesh Agarwal, a Chandigarh-based firm owner and the alleged mastermind. Police have frozen over Rs 2 crore across multiple bank accounts to prevent further losses. Dixit claims to have 16 degrees and an entry in a world book of records, but authorities are verifying these claims.
How the Scam Operated
The case was registered on June 13 this year at Pachpaoli police station by the Economic Offences Wing (EOW) and cyber cell under relevant sections of the IT Act and the Maharashtra Protection of Interests of Depositors Act. The fraud centered around a multi-level digital company registered in 2022 in Mohali, Punjab, which promised massive returns through a 'Future Digital Assets' (FDA) app.
According to investigators, Dixit's wife Kajal worked at the complainant's residence and informed her about the 'investment scheme' in October 2025. The victim was later taken to Dixit's office at Indora Chowk, where she was persuaded to join. Under the 'Free Coin' model, users were promised Rs 12,500 in their wallet after 100 days, but withdrawal required recruiting 25 new members at Rs 5,000 each, forming a multi-level chain allegedly guaranteeing monthly earnings of Rs 1 lakh from the second month.
Police said the victim recruited 25 individuals and transferred funds to the company. Dixit also promoted a 'Merchant Coin', falsely claiming its value would rise from Rs 2,200 to Rs 12 lakh. The woman invested Rs 2.25 lakh and saw her digital wallet value inflated to Rs 5.45 lakh, but withdrawals were blocked under pretext of company rules limiting payouts to Rs 10,000 per month. Repeated refund assurances were made by Garg, who allegedly offered false promises.
Scale of the Fraud
Police estimate that over 10 lakh users had signed up nationwide. Within 12 hours of registering the FIR, authorities stopped 603 new users from joining. Five bank accounts and fixed deposits worth Rs 2.10 crore have been frozen. Seized items include four laptops, a mobile phone, and Rs 450 in cash.
Dixit was arrested in Nagpur on June 13, while Garg was nabbed in Chandigarh on June 15 while en route to a seminar. Both are currently in custody. Police believe the operation involved app developers, designers, and logistics personnel.
Victim's Story
Gurvinder Singh, an acquaintance of the victim, said, "The victim is a single parent and had planned to invest the money for her children. She even mortgaged her jewellery to arrange the funds. Initially, she was told she would receive the money in December, but later the deadline was shifted to March."
"While seeking investments, it was assured to investors that they would be allowed to withdraw all the money in the digital wallet and would be required to maintain a minimum balance of Rs 4,000," said Singh. However, the money could never be withdrawn, and it turned out to be a scam.
Forensic Audit and Police Comments
A forensic audit confirmed that 'Merchant Coin' had no legitimate banking linkage or redemption value on any e-commerce platform. Nagpur Commissioner of Police Ravinder Singal described it as a large-scale multi-level fraud with the potential to cause massive financial damage. "We cannot rule out foreign investors. The accused also used fake AI-generated images of IPS and IAS officers, leading to additional charges of impersonation," he said. "We are in the process to block access to the website promoting the scheme."
DCP (Crime & Cyber) Deepak Aggarwal noted that the coins had no real backing, while Joint CP Navinchandra Reddy and other officers were part of the investigation led by EOW and cyber teams, including Senior Inspector Sudhir Borkute. Further investigation is underway to trace the full financial trail. Police have urged citizens to remain cautious of digital investment schemes promising guaranteed returns.
