The Enforcement Directorate (ED) is looking into several cases of online gaming fraud, including those involving transactions totaling approximately Rs 4,000 crore and involving businesses run by China-based entities through dummy Indian directors.
The agency is looking into the money trails of 1,815 suspect accounts in the case involving Chinese entities. It asserts that Linkyun Technology Private Limited and Dokypay Technology Private Limited were responsible for defrauding users of Rs 1,146 crore.
The ED claims that the parent companies in China provided the initial capital for these businesses in the form of Foreign Direct Investment (FDI). According to the allegations, the Indian businesses collected payments for several mobile applications that were removed from the Google Play Store for misconduct.
“Download links of such banned apps can be shared through any online messaging platform,” an agency official told The Hindu.
During its investigation, the agency claims to have discovered that the con artists used a variety of payment gateways to conduct international “hawala” transactions and receive domestic revenue. Based on “bogus” airway bills and fabricated invoices showing the import of cloud CCTV storage rental services, the ED discovered that Rs 106 crore were sent to Singapore and Rs 100 crore were sent to Hong Kong using numerous shell companies. This was the result of a trial involving Rs 263 crore. A cryptocurrency exchange was used to move approximately Rs 57 crore.
Additionally, the agency focused on five domestic businesses that had opened accounts at the Mumbai branch of a public sector bank. Further investigations resulted in the discovery of 49 additional accounts with a private bank and approximately Rs 723 crore in overseas transfers. Rs 42 crore were transferred using a different account at the Gurugram branch of a Korean bank.
The ED has thus far made several arrests based on the findings, including those of Chinese national Yan Hao, Indian director Dhiraj Sarkar, Deepak Nayyar and Indian crypto trader Naisar Shailesh Kothari.
The agency had claimed that the funds were laundered to Hong Kong through Mumbai-based branches of the State Bank of India and the State Bank of Mauritius following Mr. Nayyar’s arrest in May. Ravi Kumar, a chartered accountant, was arrested earlier in the case, which has so far seized assets worth Rs 45 crore.
In one more case including the E-nuggets gaming application, the ED has seized or frozen resources worth over ₹51 crores, including Bitcoins. It is alleged that the money collected from victims was laundered through more than 300 different accounts.