Some victims of the illegal investment fraud carried out by IX Global LLC, IX Global Academy Pvt Ltd, Pochale Global Academy Pvt Ltd and TP Global FX are receiving summons from the Mumbai police and the Kolkata office of the directorate of enforcement (ED). In the summons, the Mumbai police and the ED are asking victims for their ID proofs, investment details and bank accounts reflecting their investment in the investment fraud.
iX Global (now ONE X) claims to be an online education platform for financial markets, e-commerce, blockchain, and NFT, as well as for community, leadership, technology, and social networks.
iX Global, a multilevel operation falsely presenting itself as a direct-selling company, orchestrated a vast network of 12 companies, ten websites and nine mobile applications, that were instrumental in carrying out the fraudulent activities.
They claimed to sell 28-day online education subscriptions. In their complaint, the victims mentioned that they paid US$115-US$185 per 28 days for forex automation (FIBO 5) which gave them a chance to get monthly returns of 5%-15% on their investment with TP Global FX.
The funds, which they claimed were to be invested for gold and forex trading bots, unauthorised forex trading platforms, and non-fungible tokens (NFTs) promising daily returns of US$20-US$50, were misappropriated along with the licences for 'mining' cryptocurrency 'backed by commodities' which were illicitly moved (% not known yet) out of India. They used one company account in India, and international payment gateway linked to bank accounts in other countries, about 16 cryptocurrency wallets and nearly 49 mule accounts.
iX Global, promoted in India by Viraj Patil, his associates and related entities, asked investors to invest in TP Global FX to charge a periodic (28-day) subscription ranging from US$50 to US$180 for their algorithmic trading bots. The money is collected from investors and deposited in various bank accounts with mule accounts of the shell companies, converted to cryptocurrency, and transferred or deposited by converting the Indian rupee to US dollar and transferring it to bank accounts in London. iX Global also made the investors deposit money in the mule accounts, directly and indirectly, to launder it.
During its investigation, ED detected 180 accounts used in this investment fraud, while the victims reported 61 accounts in India and international banks, 14 crypto wallets and four money mule accounts where they were guided by the promoters to deposit or invest money.
The victims also shared names of banks used by iX Global and TP Global FX, including their directors and associates. They say accounts in Indian Bank, Canara Bank, ICICI Bank, Yes Bank, IDFC First Bank and Union Bank of India were used domestically, while accounts in international banks like Zenith Bank (Africa), Guaranty Trust Bank Ltd (Africa) and Blackthorn Finance Ltd (UK) were also used to transfer money.
While the summons sent by Mumbai police refers to a complaint by the victim, the ED summoned a person from the Amravati district of Maharashtra to appear before its Kolkata zonal office to provide evidence and records for the investigation. The ED also threatens the victim with penal proceedings for failing to attend its office on the given time and date.
It says, "Without prejudice to the provisions of any other law for the time being in force, if you fail to attend to give evidence or produce books of accounts or other documents as mentioned...at the place and time as specified in the summon, you shall be liable to penal proceedings under the Prevention of Money Laundering Act (PMLA) (15 of 2003)."
iX Global, through Pochen Global Services and other names, promoted and used the following schemes in direct selling multilevel marketing (MLM) format in India:
1. Forex Automation - 28 days - Investment US$115/US$145/US$185
2. Investment in unauthorised forex trading platform (TP Global FX) - Rs1 lakh to Rs1.50 crore per investor
3. Investment in 'CryptoLand' NFT - US$1500 to US$1750 per unit
4. Investment in 'the debt box' cryptocurrency token - US$1500- US$15,000 per mode per licence to mine crypto tokens (investor-victims invested in multiple licences)
5. Investment in the hosting of the licences for the nodes and V Box - US$500 per month
6. Investment in unauthorised forex trading platform (FX Opulence) - Rs50,000 - Rs50 lakh
According to emails sent by victims to authorities with a copy to Moneylife, many have invested Rs2 lakh to over Rs1 crore in the fraud investment scam. Pranjal R Daniel of Strategy India, a direct selling consultancy, says, "The number of affected individuals spans across the country; we have received more than 600 emails (in a different format than the one you forwarded), victims where the commissioner of police (CP) Mumbai, financial intelligence unit-India (FIU-IND) and ED were also marked."
"The scale of this fraudulent activity is undeniably significant," Mr Daniel says, "The individual involved, a former member of the US Army and US citizen (Joseph Martinez, founder and chief executive officer -CEO of IX Global), leveraged their prior experience in promoting a similar MLM (Kuvera Global) in India before IX Global to orchestrate a complex scheme for siphoning funds from India through a network of mule accounts. Joseph Martinez, Viraj Patil, and Tushar Patel (and team), as well as the Debt Box team and numerous other accomplices, including advocates, corrupt officials, and money mules."
While putting a number for investor victims from India in the iX Global scam is not easy, lakhs of rupees invested by individuals makes this one of the biggest investment frauds.
Viraj Patil, who is behind bars, was running iX Global's investment scam in India. In a statement to the economic offences wing (EOW) of Mumbai police on 22 July 2022, he stated that iX Global has 18,000 members. A September 2022 article from Business from Home (BFH) says the membership increased to 130,000 under the leadership of Mr Patil. In January 2023, the same portal claimed that iX Global's members increased to over 1.5 lakh.
iX Global, promoted by Viraj Patil in India, utilised influence to attract investors to invest using TP Global FX platform, promising substantial returns. Consequently, investors poured their funds into this fraudulent scheme, and these funds were diverted by these people to acquire personal assets.
As part of the crackdown, ED, Kolkata, seized Rs1.36 crore in cash, 1.2kg of gold valued at Rs71 lakh, two luxury cars worth Rs89 lakh, and Rs14.72 lakh from a bank account. In addition, the ED attached properties worth Rs118.27 crore, including flats, vehicles, hotels, and resorts, as part of the ongoing prosecution proceedings against Prasenjit Das and Shailesh Kumar Pandey.
Mr Daniel from Strategy India says, "In July 2021, we unequivocally placed IX Global on our fraud alert. We had gathered irrefutable evidence that they were actively promoting an unauthorised forex trading platform, TP Global FX, through numerous mule accounts (approximately 50+, including cryptocurrency wallets)."
Last month, Mumbai police booked 25 entities, including the directors of IX Global, IX Global Academy, Pochale Global Academy, TP Global FX, their directors and agents for duping 204 investors of around Rs35.21 crore. Following a first information report (FIR) filed by victims with the Kolkata police, the ED has been investigating the investment scam. In January this year, the ED conducted searches under the provisions of the PMLA in Kolkata and froze Rs64 lakh in bank accounts and cryptocurrency, mainly BTC 1.46 (equivalent to Rs57 lakh) lying in a crypto wallet in the Binance crypto exchange in the case of TM Traders and KK Traders.
In its summons, ED is asking complainants-victims also to provide details of family members and known persons who may have made similar investments.
As per a writ petition filed before the Calcutta High Court (HC), around Rs121.02 crore has been lying in 180 bank accounts of various entities related to the case.
Earlier, ED had arrested Shailesh Kumar Pandey, Prasenjit Das and Viraj Suhas Patil. In this case, Rs121.16 crore was frozen in bank accounts under section 17(1A) of PMLA, and properties worth Rs121.23 crore in cash, gold, flats, hotels, resorts and vehicles were attached. The ED also filed prosecution complaints against Shailesh Kumar Pandey and Prasenjit Das.
Police from Mumbai and Kolkata have issued arrest warrants against Joseph Martinez, founder and chief executive officer (CEO) of US-based IX Global. While iX Global defrauded investors from the US through Debt Box in India, Mr Patil used TP Global FX to cheat investors from across the country.
As per the FIR (first information report) registered by the Amboli police station in Mumbai, these 25 entities collected money from 214 investors by promising 5% to 25% returns every month on investments in binary, forex, sports and cryptocurrencies.
In November 2022, Mr Daniel sent a communication to the Securities and Exchange Board of India (SEBI) chief alerting on a forex trading and investments scam allegedly worth around Rs16,000 crore run by TP Global FX and thedebtbox.com, an associate of iX Global.
In the communication to SEBI, Mr Daniel mentioned, "Apart from collections of money against monthly 'subscriptions' for forex trading bots (US$50/115/145/180=US$100mn-million from April 2022 to 8 October 2022), investments of more than Rs16,000 crore in TP Global FX (in the alert list of RBI) and the collection of deposits and investments for the debt box, also not permitted by SEBI."
"iX Global also collected Rs104.70 crore from investors 'against' investment in a non-fungible token (NFT) at US$1500 per unit if purchased in seven days (March 2022) and US$1750 per unit if purchased after seven days," he says. NFT is a unique digital identifier recorded on a blockchain. It is used to certify ownership and authenticity and can be transferred by the e-owner only.
Market regulator SEBI forwarded the information to RBI, saying that it observed that TP Global FX was engaged in forex trading without authorisation and included in the alert list issued by RBI and thedebtbox.com was in the business of cryptocurrencies and selling licenses for mining. "As these matters fall under the purview of RBI, the complaint is being referred for info and necessary action," SEBI said in a letter to RBI in December 2022.
In the same month, SEBI forwarded the complaint against IX Global Academy Pvt Ltd to the chief secretary of Maharashtra. It stated, "The complaint is being forwarded to you for your information and necessary action under the Banning of Unregulated Deposit Schemes Act, 2019."
