The Directorate of Enforcement (ED) has filed a chargesheet under the Prevention of Money Laundering Act, 2002, against hacker Srikrishna Ramesh, alias Sriki, and 18 others linked to the hacking and theft of Rs 11.5 crore from the Karnataka government’s e-governance unit in 2019.
ED filed the chargesheet in a Bengaluru court on Monday with Sriki, accused of hacking cryptocurrency exchanges, online poker sites, and government portals, being named as accused number one.
The chargesheet was filed even as the new Congress government in Karnataka nudged the state police to order fresh investigations into cases registered against the hacker during the last BJP government from 2019-2023 on account of insinuation of corruption involving police officials and politicians in the handling of Bitcoin and funds found with the hacker and associates.
The Congress government, based on a letter sent by the state police chief Alok Mohan on June 24, issued an order on June 30 for the constitution of a Special Investigation Team (SIT) of the Karnataka Police under the direction of the Criminal Investigation Department to probe the hacking cases registered by various police units linked to a case involving Sriki.
The government order specifically directs a probe into the hacking activities involved in a crime registered by the Bengaluru Central Crime Branch (CCB) in 2020 at the Cottonpet police station against Sriki and his associates accused of hacking international crypto exchanges and poker gaming sites to obtain illegal wealth.
The crime registered at the Cottonpet police station in 2020 “involves probable involvement of national and international networks”.
Although the chargesheet filed by ED this week against Srini and 18 others is not directly linked to the 2020 CCB case, the two cases have several overlapping features—the same gang was involved in the hacking crimes and it was the arrest of Sriki by the CCB in 2020 that opened the pandora’s box on the criminal hacking activities of the gang, including a July 2019 heist of Rs 11.5 crore from the state e-procurement cell.
The money laundering probe by ED into the theft of Rs 11.5 crore from the e-procurement cell resulted in the seizure of Rs 1.43 crore of stolen funds classified as proceeds of the hacking crime. ED in its seizure report in August 2021 said the gang involved in the hacking crime paid commissions to businessmen who received stolen funds in their accounts to facilitate cash transfers back to the hackers.
The CID and ED probes into the flow of money following the hacking at the e-procurement portal have revealed Sriki and his associates Suneesh Hegde, 36, Hemanth Mudappa, 33, and Prasidh Shetty, 26, set up an elaborate laundering system for transfer and collection of the stolen funds during the preparations for the cyber heist.
In a voluntary statement given to the CID following his arrest, Sriki had stated that the initial hack of Rs 1.05 crore was done by him with a network that he had created for money laundering, while the second hack of Rs 10.50 crore and subsequent attempts at stealing nearly Rs 35 crore was done at the behest of his associate Suneesh Hegde, a civil contractor and businessman.
Sriki’s three associates and colluders Vinit Kumar, Sushil Chandra, and Harwinder Singh have been named in the ED chargesheet.
Out of the Rs 1.05 crore stolen on July 1, 2019, ED was able to recover Rs 30.76 lakh that was identified as proceeds of crime lying with Nimmi Enterprises and the other conduits. In the case of the theft of the Rs 10.5 crore on July 9, 2019, the money trail took CID and ED to a Nagpur-based NGO Udaya Grama Vikas Samstha and multiple firms to whom the stolen funds were relayed for hawala transfer to the hackers.
The two owners of Udaya Grama Vikas Samstha—Ratnakar Walke and his wife—Randhir Ashar, who identified the NGO account for laundering the stolen funds, six people in Bengaluru who arranged the hawala transfers for the hacking gang have all been charge-sheeted by ED.
According to the ED seizure report of August 2021, Rs 1.13 crore out of the Rs 10.5 crore stolen on July 9, 2019, has been recovered from the bank accounts of the NGO (Rs 74 lakh) and other entities like businessman Rajkumar Sanklecha (Rs 21 lakh) to whom Rs 2.7 crore of the stolen funds was transferred by the NGO in the guise of payment for wires and cables. Sanklecha has not been named in the PMLA case.
ED has questioned several people, including the sons and grandsons of several prominent politicians cutting across the political spectrum who were associated with the hacker and his activities from around 2018, in the course of its money laundering probe.
The agency also investigated transactions linked to Sriki’s older brother Sudarshan Ramesh, who was prevented from leaving India in January 2022 by immigration authorities on the basis of a lookout circular issued at ED’s instance. ED said Sudarshan had received 50,000 British pounds out of crime proceeds in his account and transferred them in May 2021 to a person identified as Hanish Patel, a UK resident running a firm called GCP UK Ltd.
ED had informed the Karnataka High Court at the time that Sriki was involved in laundering funds stolen through hacking crimes. The agency alleged Sriki used cryptocurrencies to launder funds stolen through his hacking activities. He allegedly carried out conversions to multiple cryptocurrencies and traded the converted cryptocurrency on international platforms for personal gains, it added.
The hacking of the e-procurement cell hack and the alleged hacking of international bitcoin exchanges by Sriki stoked a major controversy in 2020-2021 in Karnataka following allegations by the then Opposition Congress of the involvement of people in high positions in protecting the gang.
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