Six people were arrested for allegedly robbing a businessmen wishing to purchase bitcoins from Localbitcoins.
The Delhi-based businessman filed a complaint stating that he had been robbed by a gang, whose members claimed to be Bitcoin dealers from the Locabitcoins.com platform.
He was abducted from the Nirman Vihar Metro Station near Laxmi Nagar and taken to Vaishali, Ghaziabad, where he was assaulted, robbed, and threatened.
The alleged victim stated that he uploaded his information to the localbitcoins.com platform an received a call from a Locabitcoins trader calling herself Karishma Rajput offering bitcoin at a rate of Rs 72,000 ($1102.86 USD).
The supposed "trade" was to occur locally on April 7th, however instead of bitcoins, the complainant allegedly received a beating and was robbed of Rs 36 lakh ($55142.86 USD)
Police raids in NCR, Uttarakhand and Uttar Pradesh located four gang members, Karamvir Singh, Sandeep and Devendra Chauhan and Kunal Sharma, who were arrested on September 2.
Priya Thakur (aka Karishma Rajput) and Yashashvi Sharma (aka Aditya Rajput) were additionally arrested on September 27.
Amandeep and Kuldeep are yet to be arrested.
It's important to note that these individuals were not really "Localbitcoins traders" or bitcoin traders at all and there is no affiliation with Localbitcoins or bitcoin at all with these idiots. The trading platform and digital currency were a vessel and a tool for these alleged criminals to obtain cash.
The gang members registered on Localbitcoins under aliases and would call or contact buyers through Facebook and convince the them to transact cash-in-person bitcoin trades, a popular but dangerous trading method, where people meet one-on-one or party-to-party to exchange cash in person for bitcoins.
Once the trade was arranged, the other gang members would then meet and rob the victim.
This is type of crime is more common than many realize. In 2014/2015 a Houston trader was bashed in the head with a glass bottle during a cash-in-person trade and an Australian trader was abducted among many other incidents world-wide.
Granted, not all were violent, but if that doesn't ruin your day, just try explaining this scenario to the police which is not only problematic, but scrutinized as many local law enforcement agencies remain clueless as to what bitcoin or any digital currency is.
On April 7th the price of bitcoin around $2500 and these guys were "selling" for a rate of $1,100 USD. That's should have been a big fat red flag right there because if it wasn't fraudulent as it turned out to be, the coins were likely to have been stolen or some other scheme would have likely been in play.
If someone offers to sell you bitcoins for 15% or more under the market rate, be cautious (although note that 10% under market is actually realistic), if it's nearly 50% or more as in this case, run like hell!
If it's too good to be true, it likely is and as we always say, if it walks like a duck... it's a fucking duck.