India's BoM Bank was robbed of Rs 614 million, hackers transferred the stolen money via Bitcoin

Golden Finance News - India's Bank of Maharashtra (BoM) lost Rs 614 million (about $950,000) in 49 days as four hackers exploited a vulnerability in the bank's UPI application and stole huge assets from the bank.

(614 million rupees stolen from Maharashtra Bank, India. Image source: Golden Finance)

The theft affected 23 branches in the Pune region of India, and some of the stolen funds were used to invest in Bitcoin. The hackers invested in Bitcoin through three companies in western India.

Police reportedly froze the accounts of three companies involved in bitcoin transactions. Bitcoin has not yet been officially recognized as a currency by the Reserve Bank of India (RBI). Cyber ​​investigators from the Pune police recovered 458 million rupees, including bitcoins worth 100 million rupees (about $155,000), from the theft suspects.

Besides the seized bitcoins, police also seized 40 mobile phones and 27 SIM cards from the accused Jitendra Maruti Rindhe (42), Sandip Ashok Mule (30), Dipak Sarjerao Kharat (26) and Rajesh Janardhan Budkhule alias Soni (48).

The accused, many of whom held their own BoM accounts, hacked into the UPI app to gain access to bank customer accounts. The hackers allegedly exploited a vulnerability in the banking app developed by Mumbai-based InfrasoftTech to break into BoM's systems.

The defendants also used real-time gross settlement (RTGS) to remit the funds they received into accounts controlled by them.

Investigators allege that the 50 accused had developed a chain of account holders at the BoM to hide the stolen funds. For example, the accused contacted 15 farmers and got SIM cards from them and paid them Rs 5,000 per month.

Cyber ​​crime investigators have determined that some of the misappropriated funds had been transferred to intermediary agencies such as Zeb IT Services Pvt Ltd, Oracle Retail Pvt Ltd and Ahmedabad-based Milton Medocore Pvt Ltd.

Senior Inspector of Cyber ​​Crime Sunil Pawar told the media,

“Rajesh Budkule is the prime accused in this case. We have found that the accused formed a chain-like multi-level marketing (MLM) system and approached farmers in Narayangoan and Junnar.

The accused took SIM cards of farmers and linked them with the account numbers of BoM on the pretext that they would provide monthly funds towards Pradhan Mantri Jan-Dhan Yojana and Pradhan Mantri Fasal Bima Yojana. In this way, they used UPI app to commit crimes. Both the accused are still absconding. ”

The BoM filed a complaint with the court, which called for strict litigation measures against specific Bitcoin businesses.

(BoM representative Rajas Pingle said RBI has not issued any authorization for Bitcoin to any company. Image source: Golden Finance)

BoM representative Rajas Pingle said:

“The Reserve Bank of India issued a circular in February stating that no license or authorization has been granted to any entity or company to operate such schemes relating to Bitcoin or any Bitcoin.”

The Indian government needs to be clear about India’s stance on Bitcoin, especially as concerns grow about money laundering or financing of terrorism.

Abhijeet Bidkar of Zeb IT Services Pvt Ltd told the media that Bitcoin trading on Zebpay exchange is legal. He said: "Bitcoin is legal in several countries including Japan. Users can trade on Zebpay only after submitting KYC documents. All purchases and sales are strictly done through bank accounts and there is no cash. Therefore, all transactions will be recorded and easily identifiable. All these users are easily identifiable and we are helping local institutions to recover the funds."

The RBI said in February that it has not issued any licenses to Bitcoin companies to operate in the country.