In a shocking turn of events, Pakistan local law enforcers are joining forces with local crime syndicates to steal money from everyday citizens.

One of the victims of such attacks is crypto trader, Mohammed Arsalan. Arslalan was kidnapped in broad daylight and was forced to give up his entire lifesavings to the kidnappers.

Pakistani crypto kidnapped

Arsalan, a 30-year old crypto trader, recounted that his nightmare began when a man named Hamid persistently contacted him to purchase US dollars. Despite his repeated refusal, Hamid remained in touch, eventually persuading Arsalan's friend Zohaib to arrange a meeting.

On December 24, three men visited Arsalan’s office at Saima Arabian Villas, posing as potential buyers. Two suspects, later identified as Muzamil and Hammad, convinced Arsalan to join them at a nearby restaurant, where additional accomplices awaited.

In the early hours of December 25, five men in plain clothes, arriving in an unmarked police vehicle, forcibly abducted Arsalan. They gagged him and transported him to a location near the Federal Investigation Agency (FIA) Saddar office, where they coerced him into unlocking his Binance account.

Over the next few hours, the kidnappers transferred $340,000 worth of cryptocurrency to multiple wallets. Arsalan was released near the Quaid-e-Azam mausoleum at 4 a.m., from where he safely returned home.

The Anti-Violent Crime Cell (AVCC) launched an investigation based on Arsalan’s complaint, resulting in the arrest of seven suspects: Mohammed Rizwan Shah, Tariq Hasan Shah, Muzamil Raza, Umer Jilani, Umer Irshad, Noman Riffat, and Haris (alias Ashar). Police described them as habitual offenders with a history of similar crimes.

But what was unexpected was the participation of CTD officers, which has intensified scrutiny on Pakistan's law enforcement agencies. CTD reassured the public that the actions of the CTD officers involved in the crime is not a representative of the whole agency, and the agency would enforce a stricter punishments on these law enforcers who have deliberately broken the law.

Arslan blames it on the broken legal structure, putting investors at risk

The involvement of CTD officers has intensified scrutiny on Pakistan’s law enforcement agencies. Inspector General Memon emphasized that the arrested officers acted individually and would face strict consequences. “We do not spare anyone,” he stated.

Arsalan blames the broken policing structures as the reason why crypto crimes is so proliferated in the country. He explains that the lack of legal frameworks governing digital assets leaves traders at risk of exploitation, with few avenues for recourse in cases of theft and fraud.

But Pakistan has recognised this issue, and is currently working on it. Currently, it is preparing to amend the State Bank of Pakistan Act to legalize digital currencies and allow the central bank to oversee physical and digital financial assets.

These amendments aim to empower the SBP to issue and regulate digital currencies as legal tender while establishing a subsidiary to develop digital payment systems.

This move follows a Sindh High Court directive requiring the government to create a regulatory framework for crypto assets, reversing Pakistan’s restrictive 2018 stance on cryptocurrencies. The SBP is also accelerating efforts to launch a digital rupee this year.