Telangana Police Bust ₹19 Crore USDT Crypto Fraud Linked to Fake KYC Website
Three Arrested in Hyderabad Cybercrime Case
Victim Duped Through Malicious Smart Contract on Trontag.org
By Our Legal Correspondent
New Delhi: February 17, 2026:
In a major crackdown on cybercrime, the Hyderabad Cyber Crime Police have arrested three individuals for allegedly siphoning off cryptocurrency worth ₹19.08 crore (21,04,089 USDT) from a local trader. The fraud was executed through a fake KYC verification website, highlighting the growing risks faced by crypto investors in India.
The Case: Fake KYC Website and Malicious Smart Contract
The victim, a 44-year-old trader from Kalyan Nagar, was approached by fraudsters posing as buyers interested in purchasing USDT (Tether). To “complete the transaction,” they directed him to undergo a Know Your Customer (KYC) verification on a website named Trontag.org.
Once the victim logged in and followed instructions, a malicious smart contract was triggered, transferring funds directly from his crypto wallet to wallets controlled by the fraudsters.
The arrested accused were identified as:
- Sushim Shripati Gaikwad from Pune, Maharashtra
- Srikanth Bairoju from Hyderabad, Telangana
- Lucky Choudhary from Jaipur, Rajasthan
Police investigations revealed that the website was designed as a phishing tool to capture login credentials, authentication data, and wallet access.
How the Fraud Worked
- Step 1: Contacting the victim – Fraudsters posed as genuine crypto buyers.
- Step 2: Fake KYC process – Victim was asked to verify identity on Trontag.org.
- Step 3: Smart contract activation – Malicious code transferred USDT from victim’s wallet.
- Step 4: Diversion of funds – Cryptocurrency was moved to multiple wallets controlled by the accused.
This case demonstrates how social engineering and technical manipulation can combine to exploit unsuspecting investors.
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Police Action and Investigation
The Hyderabad Cyber Crime Police acted swiftly after the victim lodged a complaint. Technical analysis of blockchain transactions helped trace the diverted funds and identify the accused.
Authorities are now working with crypto exchanges and wallet providers to freeze suspicious accounts and recover stolen assets.
Lessons for Crypto Owners: How to Prevent Such Frauds
This case highlights the urgent need for crypto investors to adopt strong security practices. Here are key precautions:
1. Verify Websites and Platforms
- Always check the URL and ensure it belongs to the official exchange or wallet provider.
- Avoid clicking on links shared via email, WhatsApp, or social media.
2. Beware of Fake KYC Requests
- Exchanges and wallets conduct KYC only through their official apps or websites.
- Fraudsters often create lookalike sites to steal credentials.
3. Understand Smart Contracts
- Malicious smart contracts can drain wallets once permissions are granted.
- Never approve unknown contracts or give unlimited access to tokens.
4. Enable Multi-Factor Authentication (MFA)
- Use MFA for all crypto accounts to add an extra layer of security.
- Prefer hardware wallets for large holdings.
5. Stay Updated on Scams
- Follow advisories from RBI, SEBI, and CERT-In.
- Join crypto communities that share alerts on phishing and fraud attempts.
Also Read: Supreme Court Slams Successive FIRs After Bail: Calls It Abuse of Process, Fit Case for Article 32
Wider Context: Crypto Frauds in India
India has witnessed a surge in crypto-related frauds, ranging from Ponzi schemes to phishing attacks. With increasing adoption of digital assets, cybercriminals are exploiting gaps in awareness and regulation.
Authorities are pushing for stronger crypto regulations under the proposed Digital India Act, which may include mandatory reporting of suspicious transactions and stricter KYC norms.
Conclusion
The Telangana crypto fraud case serves as a wake-up call for investors. As digital assets gain popularity, so do risks of cybercrime. The arrests highlight the importance of vigilance, awareness, and secure practices in the crypto ecosystem. For traders and investors, the message is clear: trust only verified platforms, safeguard your wallets, and never fall for fake KYC traps.
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