Illegal telecom exchange operators used crypto to send money abroad: ATS official on Pune case

Pune: The main operators of an illegal telephone exchange in Pune's Kondhwa area used cryptocurrency to transfer their earnings abroad, sources from the state anti-terrorism squad (ATS) have told TOI, adding that these individuals were likely based out of Haryana's Nuh and other cities in north India.
The illegal exchange, operating out of a rented first-floor flat, was busted by the state ATS on Aug 24-25.The raiding team seized 3,788 SIM cards, nine Wi-Fi routers, SIM box antennas, laptops and seven SIM boxes. They also arrested one person, identified as 32-year-old Naushad Ahmed Siddiqui, who they said was operating the Pune facility. Since then, four more people have been arrested in connection with the case, from parts of Maharashtra and Rajasthan.
"The main suspects used cryptocurrencies for all of their international transactions. They also received crypto from their foreign partners. All domestic payments though, to local operators, were made in Indian Rupees, via transfers to their bank accounts," a senior ATS official said.
Authorities said the illegal facility was set up to bypass regular cellular networks in India by using Internet telephony, which allows one to make and receive calls without using traditional or licensed phone networks. Individuals based in Nuh and Thane's Bhiwandi and other parts of the country were operating such a network to illegally route calls coming to India from foreign countries, the authorities said.
"Govt of India charges money for international calls, including the calls made using various internet-based applications, which come to Indian phone users from foreign countries. Illegal telecom exchanges are used to avoid those charges. They also cause a loss to the exchequer," the ATS official said, adding that many countries have banned online apps that allow users to make 'off-network' audio or video calls to another person in a foreign country.
"So when someone makes a call to India using such online apps, from a country where internet calls are banned, the call is first routed through an illegal telephone exchange based in that country, and received by one in India. It bypasses the local mobile phone tower as the SIM box directly receives the call," the official said.
Investigators said the operators of foreign illegal phone exchanges would receive money from customers who used their service regularly. "But they also had to pay their counterparts in India, at the receiving exchange. Problem is, govt tracks legitimate bank transfers, so they used crypto to pay their accomplices in the country. The operators based in India would also transfer earnings in the form of cryptocurrency to their foreign counterparts, in the same way," the ATS officer said.
The investigators are now checking bank accounts of some operators to determine how much in cryptocurrency they received and transferred.