CBI Cracks Down on Massive HPZ Crypto Fraud: 7 Raids, 5 Arrests in Transnational Network
In a strong action against cyber-enabled fraud, the Central Bureau of Investigation (CBI) carried out raids on October 3, 2025 in a coordinated manner at seven locations across Delhi-NCR, Hyderabad, and Bengaluru. The operation led to the arrest of five individuals involved in a large-scale cryptocurrency scam connected to the HPZ Token App. This action forms part of the CBI’s broader Operation Chakra-V, which aimed at dismantling illegal crypto schemes and cross-border financial crimes across the nation.
Background
What is HPZ Token?
The HPZ Token was marketed via a mobile app as a way for ordinary people to invest in the mining machines for Bitcoin and earn huge returns.
Earlier Investigations by ED
The Enforcement Directorate (ED) had already been probing the HPZ token. In previous raids (in 2023), the ED froze large sums — more than ₹91.6 crore — in bank and merchant accounts linked to shell entities.
- In a press release dated April 24, 2023, the ED revealed that companies like Shigoo Technology Pvt. Ltd and Lillian Technocab Pvt. Ltd were involved, and a key figure, Bhupesh Arora, allegedly used these companies to run unregistered gaming apps and lure people to invest in HPZ.
- By August 2024, the ED had attached movable and immovable assets worth ₹41.83 crore linked to shell companies involved in the fraud.
CBI’s Wider Campaign on Operation Chakra-V
The raids are part of Operation Chakra-V, a broader operation by the CBI to crack down on cyber-enabled fraud. This includes not just crypto fraud, but also cybercrime involving illegal gaming, impersonation, call-centre scams, and misuse of mule bank accounts.
Timeline of Events
- 2021–2023: According to the CBI, the fraud network operated for several years. During this period, they ran schemes disguised as “loan,” “job,” “investment,” and “cryptocurrency” opportunities.
- February 2023: The ED conducted searches in various cities (Delhi, Gurgaon, Mumbai, Bengaluru, Salem) as part of its PMLA investigation.
- April 21, 2023: ED raids bank and payment gateway premises; they seize (and freeze) large amounts from accounts linked to shell companies allegedly run by Arora and others.
- September 2023: ED seizes about ₹55.36 crore from shell company accounts.
- August 12, 2024: ED attaches assets worth ₹41.83 crore linked to the fraud network.
- May 2024: CBI conducts a huge nationwide search across 30 locations in 10 states and Union Territory.
- They seize digital devices (laptops, phones), ATM/debit cards, SIM cards, email account data.
- They identify about 150 bank accounts used to collect victim funds.
- The accused companies and directors are sued under IPC sections 120-B (criminal conspiracy), 419/420 (cheating), and IT Act section 66D.
- October 3, 2025: The major coordinated raids by CBI at seven locations; five arrests made.
- Post-Raid (Ongoing): CBI says it is tracing cross-border financial transactions, identifying foreign masterminds, and using digital forensics to reconstruct the fraud network.
Forensic & Investigative Significance
Shell Companies & Mule Accounts
A key part of the scam involved creating fake or shell companies. The CBI found that several such companies were set up in India, likely on instructions from people outside the country. These companies then opened “mule” bank accounts that were used only to transfer illegal money. The money taken from victims was moved through these accounts.
Money Laundering Through Crypto
The money taken from investors wasn’t kept in normal bank accounts. Instead, it was converted into different cryptocurrencies, passed through many financial channels, and then sent to other countries. This made it very difficult to trace the money without detailed forensic investigation.
Digital Forensics
In the recent raids, the CBI found important digital evidence and financial documents. This shows that investigators used advanced digital forensic methods for checking computers, phones, transaction records, and crypto wallets to understand how the scam was planned and carried out.
Transnational Conspiracy
The CBI has stated that the scam was controlled by people outside of India. Some shell companies in India were reportedly created on the instructions of these foreign masterminds. Because of this, the case involves multiple countries, making the investigation more difficult due to money being moved across borders and links to international crypto wallets.
Use of Legitimacy to Deceive
The scammers used an app called HPZ Token, which looked real and trustworthy, to attract people. They promised very high profits from “mining machine investments,” which made people believe them and invest more money. In the beginning, they even gave small returns to some victims to win trust — a common trick used in Ponzi-style scams.
Why This Matters to the Public
- Investor Protection: Everyday people who used HPZ believing they were investing in mining may lose money.
- Crypto Risk Awareness: Not all “crypto investment apps” are genuine — some may be fraud.
- Policy Implications: The case might push regulators to tighten rules on crypto token apps, especially those promising guaranteed returns.
- Law Enforcement: Demonstrates that agencies can and will investigate high-stakes cyber frauds using advanced tools.
Conclusion
The CBI’s raids on October 3, 2025 are an important step in fighting crypto-related fraud in India. By arresting five people and seizing digital evidence from several cities, the agency has targeted a well-planned criminal group operating across countries.
This case shows how cybercriminals are changing their methods. They are no longer running only local scams. Instead, they now use shell companies, complex crypto transactions, and mule accounts to hide their activities. It also shows that law enforcement is improving: through Operation Chakra-V, the CBI is using better intelligence, working with other agencies like the ED, and relying more on digital forensics.
If the investigation fully exposes the network and recovers the stolen money, it may discourage others from running similar frauds and lead to stronger rules for crypto platforms, especially those that promise unrealistic profits from “mining” or investment schemes.
References
- Hindustan Times: “CBI raids 7 locations, arrests 5 persons in sophisticated cyber fraud”
- The Economic Times: “CBI conducts searches in HPZ cryptocurrency token fraud case”
- India Today: “CBI conducts nationwide searches in app-based crypto fraud (HPZ Token App)”
- Business Standard: “CBI’s case: HPZ token, non-existent Bitcoin mining machine fraud”
- ED Press Release (April 2023): HPZ token misuse, freezing of ₹178 crore
- ED Press Release (August 2024): Attachment of ₹41.83 crore in HPZ-related entities
