Ex-BJP MLA, Lawyer & Cops Wring Bitcoins Off a Builder in Gujarat

In Gujarat, a bitcoin extortion case dragged cops, lawyers and a former MLA as the prime accused.

Bitcoin is a virtual currency which is used for digital payment.

(Photo: The Quint)

At a time when bitcoin-related crimes are making headlines in the country, a recent case in Gujarat has turned out to be quite the thriller.

A Surat-based builder, Shailesh Bhatt, has alleged that on 11 February this year, he and his associate Kirit Paladiya were kidnapped by Police Inspector of Amreli Local Crime Branch (LCB) Anant Patel and other cops from the outskirts of Gandhinagar and were taken to a farmhouse in the vicinity, where 176 bitcoins worth around Rs 9.45 Crore were extorted from him.

The case has led to the arrests of police inspector Anant Patel, Amreli Superintendent of Police, Jagdish Patel along with two constables. In all, 10 police personnel have been charged in the case; charges of extortion have also been levied against former BJP MLA from Dhari, Nalin Kotadiya.

The Abduction

Shailesh Bhatt has been investing in bitcoins for a couple of years now. His lawyer, Dharmesh Patel told The Quint:

Bhatt is not tech savvy. He used his associate Kirit Paladiya’s help in managing the cryptocurrency. Paladiya maintained the bitcoin account on the mobile app, whereas Bhatt held on to the passwords.

In February, Bhatt had purchased more bitcoins, and was pulled up by a CBI officer, Sunil Nair, based in Gandhinagar, who called Bhatt to his office.

According to Bhatt, Nair threatened him to stop dealing in cryptocurrencies as it had been banned by the government. Bhatt's complaint mentioned that Nair extorted Rs 5 crore from him for not filing the case. “After settling the deal with Nair in three installments paid on 3, 5 and 7 February, my client left for Ambaji on the 9th,” said Dharmesh Patel.

On his way back from Ambaji on 11 February, Bhatt received a call from Paladiya who asked him to meet at Nisha Petrol Pump on the outskirts of Gandhinagar. Just as the duo refuelled their car and were leaving the petrol pump, three vehicles, which included two police vehicles, intercepted the duo and took them to Keshav Farms at Dhegam near Gandhinagar.

The Extortion

Nalin Kotadiya who is one of the main suspects in the case is a former BJP MLA from Dhari, Amreli.(Photo: Youtube screengrab)

It was the police inspector from Local Crime Branch (LCB) Amreli, Anant Patel, who picked up Bhatt and Paladiya from the petrol pump. Anant Patel, thrashed Shailesh Bhatt and ordered him to transfer all the bitcoins in his possession. However, according to Bhatt’s lawyer Dharmesh Patel, “Paladiya had already transferred the bitcoins into his own wallet and had staged the whole extortion gimmick to fool Bhatt.”

On 23 February, Bhatt approached the state home department, alleging that inspector Anant Patel and other members of the Amreli LCB had abducted him and extorted money in the form of bitcoins. In his application, Bhatt also said that he was forced to pay Rs 32 crore as payment for his release.

At a press conference in Gandhinagar on Sunday, 8 April, Director General of Police (CID-Crime) Ashish Bhatia said, “Paladiya’s phone was sent to Forensic Science Laboratory, Gandhinagar, but tests showed no conclusive evidence that 200 Bitcoins were indeed transferred from that phone on that given day.” A Special Investigation Team has been formed to probe the matter further.

A Fast-Brewing Conspiracy

As it turns out, Paladiya was the brain behind the bitcoin extortion plan, and has been arrested in the case on Friday, 4 May. He has been sent to a six-day remand by the court.

As per the police department, Bhatt only had 176 bitcoins in his wallet. Paladiya who had conspired to take over Bhatt’s bitcoins, worked on a plan with Surat-based advocate Ketan Patel, a close aide of Amreli SP Jagdish Patel.

Kirit Paladiya, Ketan Patel and Jagdish Patel decided that 15 percent of the extorted money was to go to the police; 15 percent to Ketan Patel, his brother Jatin Patel and Nalin Kotadiya (Paladiya’s uncle); the remaining would remain with Paladiya. The Amreli SP then brought Amreli LCB PI Anant Patel under confidence, who with his team had executed the plan.

Kotadiya earned Rs 66 lakh, while Ketan and Jatin Patel too made Rs 66 lakh. Anant Patel was arrested on 20 April and CID officials have been able to recover only Rs 2 lakh from him. Meanwhile, Jagdish Patel was arrested on 23 April and both the cops have been suspended from service. Ketan Patel and Jatin Patel were also arrested by the police department, and are under interrogation.

Kotadiya Absconding

Nalin Kotadiya, former BJP MLA from Dhari, Amreli is one of the prime suspects in the case as CDR data shows that Kotadiya had called Paladiya (his nephew) during the wee hours of 11 February. CID officials issued summons to Kotadiya twice, but according to sources, he has already left the state.

However, in a press release Kotadiya declared that he is in Dhari, Amreli and has not gone underground. He claims that it was he and his nephew Kirit Paladiya who informed the state government about an impending bitcoin scam, and that he had asked the Minister of State to intervene.

According to Kotadiya, he has evidence that Shailesh Bhatt abducted a certain Piyush Kachadiya on 1 February this year and extorted 2,300 bitcoins from him.

He further said he won’t be able to disclose much once he is behind bars and plans to approach the PMO, BJP National President, Union Home Minister, Gujarat Chief Minister with his side of the story.

Interestingly, Nalin Kotadiya has fallen out of favour with the BJP after he openly supported Hardik Patel during the 2015 Patidar Reservation Movement.