Indian police have launched an investigation into the co-founders of major cryptocurrency exchange CoinDCX, Sumit Gupta and Neeraj Khandelwal, following a complaint alleging their involvement in a fraudulent investment scheme. The First Information Report (FIR) was registered on March 16 by authorities in Thane, part of the Mumbai metropolitan region, citing allegations of cheating and criminal breach of trust tied to a scheme totaling ₹71.6 lakh (approximately $85,000). While multiple Indian media outlets reported that the founders were detained in Bengaluru and presented before a court, other sources indicated they were summoned for questioning without a confirmed arrest status.
Details of the Alleged Fraud
The complaint centers on a 42-year-old insurance advisor from Mumbra who, along with two associates, claims to have been lured into a fraudulent investment opportunity between August 2025 and early 2026. The scheme allegedly promised monthly returns of 10% to 12% and franchise opportunities linked to CoinDCX. Funds were transferred via cash and bank payments but were never returned, according to the FIR. Authorities named six individuals in the case, including the two co-founders, though investigators have not publicly established a direct operational link between the alleged fraud and CoinDCX’s official platform or infrastructure. The funds in question were reportedly routed to third-party accounts unrelated to the exchange.
CoinDCX’s Strong Denial and Explanation
CoinDCX has strongly denied the allegations, describing the FIR as “false” and attributing the case to impersonators exploiting its brand. In a public statement published on X, the company said scammers created fake websites mimicking its platform and posed as company executives to deceive investors. “The FIR filed against our co-founders is false and filed as a conspiracy against CoinDCX by impersonators posing as Founders of CoinDCX and cheating the public at large,” the exchange wrote. “We have taken cognizance of the fact and published a notice to public at large on our website that CoinDCX is being targeted by fraudsters. The entire conspiracy falsely claims that funds were transferred in cash to third party accounts which have no relation to CoinDCX.” CoinDCX also noted that it had reported more than 1,212 fraudulent domains impersonating its website between April 2024 and January 2026, and said it is cooperating fully with law enforcement. It emphasized that no user funds, trading activity, or platform security were affected by the incident.
Industry Implications and Ongoing Investigation
CoinDCX further stressed that “brand impersonation” was an “increasing concern in India’s digital finance ecosystem.” As of March 22, the investigation remains ongoing, with authorities reportedly examining the roles of all named individuals. This case highlights a broader issue in India’s digital asset sector, where impersonation schemes have increasingly targeted retail investors using cloned websites and false promises of high returns. The exchange urged investors to only use official channels for trading and to remain vigilant. The investigation is expected to continue, with legal proceedings likely to develop after court review.