Karnataka bitcoin scam: SIT closes cases against cops after prosecution nod denied

With the Karnataka government rejecting requests for sanction to prosecute police officers accused of obtaining kickbacks from hacker Srikrishna Ramesh alias Sriki, 32, and his associates, to dilute hacking cases, a Special Investigation Team (SIT) of the state CID unit has filed closure reports against police officers.

On July 1, the CID SIT (Bitcoin cases) filed a ‘B’ report for closure of a case of corruption and fraud against four police officers, who were named in a First Information Report in January 2024, but filed a chargesheet against private cyber expert K S Santhosh Kumar, whose services were used by the Bengaluru Central Crime Branch in 2020-21 to recover stolen funds (Bitcoin) from the hacker.

The CID SIT has also filed a closure report in an FIR filed in August 2023 against unnamed Central Crime Branch (CCB) officers for alleged tampering of laptops and mobile phones recovered from the hacker, during the time Sriki was in police custody in 2020-21.

“In two cases, closure reports have been filed against the accused police officers after the sanction for prosecution (PSO) was rejected by the government. The closure reports were filed last week in the courts,” said a senior police officer on the CID SIT (Bitcoin cases) probe.

The CID SIT for Bitcoin cases was constituted when the current Congress government came to power in Karnataka in June 2023, in the light of allegations of large-scale corruption involving the Bengaluru CCB police unit, senior police officers, and senior politicians in the handling of multiple hacking cases of Sriki during the BJP tenure from 2019 to 2023.

The four police officers whom the CID SIT sought to prosecute – before the denial of the sanction for prosecution by the Congress government – are Deputy Superintendent of Police Sridhar Pujar, and police inspectors Prashanth Babu, S R Chandradhar, and Lakshmikanthaiah.

First FIR against police officers in Bitcoin case

In August 2023, the CID SIT filed an FIR at the Cottonpet police station for destruction of documents and cheating against unnamed police officers of the Bengaluru CCB over alleged manipulation of electronic devices seized from Sriki and his associates.

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The CID SIT said in the first FIR that investigating officers of the CCB, who carried out the investigations of the case of purchasing drugs using Bitcoins, where Sriki and 10 associates, including the son of a Congress leader, were arrested in 2020, had tampered with the evidence collected in the case.

The complaint was registered under the Indian Penal Code sections for destruction of documents, criminal conspiracy, cheating by impersonation, and mischief.

The second case against police officers in Bitcoin scam

The SIT named five persons – cyber expert K S Santhosh Kumar and the four former CCB officers – in an FIR alleging illegal confinement, breach of trust by a public servant, and destruction of evidence filed in the Cyber Crime police station of the CID on January 24, 2024.

The four police officers – Sridhar Pujar, Prashanth Babu, Chandradhar S R, and Lakshmikanthaiah – along with private cyber expert K S Santhosh Kumar, were arrested by the SIT in 2024.

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The CID SIT has found that the cyber expert roped in to assist investigations by the Bengaluru Central Crime Branch (CCB) police into the illegal activities of the international hacker illegally accessed the crypto wallet of Robin Khandelwal, an accountant of the hacker, and transferred Bitcoin valued at Rs 1.83 lakh to his own crypto wallet.

The investigations in the case also revealed dozens of procedural lapses by the police, including illegal detention, lack of documentation of the logins, passwords, and data for computer usage by the accused, and even the provision of a laptop worth Rs 60,000 by the police to Sriki to facilitate hacking.

ED probe into money laundering from Bitcoin hacking cases

Around a year ago, the CID SIT handed over a report to the Directorate of Enforcement on the digital and financial audit of devices seized from the hacker, his associates, and police officers, in order to facilitate the investigation of the money trail for funds stolen or acquired through extortion by the hacker and associates from gaming websites and crypto exchanges.

Based on the audit report, the ED has taken the investigations further and arrested hacker Sriki, his accountant Robin Khandelwal, and associate Sunish Hegde on May 8, 2026, on charges of laundering funds obtained from the hacking crimes of Sriki.

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The arrests came after the ED conducted searches on April 22, 2026, of properties linked to Sriki and his associates, including Congress leader Mohammed Haris Nalapad, who is the son of Congress MLA N A Haris.

The ED filed a chargesheet on July 7, 2026, in a Bengaluru court regarding its findings from the PMLA probe against the hacker and his associates.

According to the investigation findings, placed in court recently by the ED, Sriki and his associates were involved in “repeated incidents of hacking, theft of VDAs (virtual digital assets), data theft, extortion and laundering of proceeds through cryptocurrency exchanges, traders, bank accounts and other financial channels.”

After the hacking crimes were committed by Sriki, stolen materials were “layered through multiple bank accounts, cryptocurrency platforms and other channels before being utilised by the accused persons, for personal benefit and further criminal activities,” the ED stated.

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The ED has stated that the hacker and his associates were involved in the hacking of the Poker Dangal, Spartan Poker, Poker Saint, GG Poker, and Poker Baazi websites, as well as the Unocoin cryptocurrency exchange and the Karnataka government e-procurement tender platform, where Rs 11.5 crore was stolen between 2017 and 2020.