The Enforcement Directorate has frozen payments worth 68 Crore after Coda Payments India Pvt Ltd (CPIPL) and its related partners extracted money from a large number of individuals, including children, by the method of “Unauthorized” payments allegedly.
As a part of the Money Laundering Investigation, the Federal Probe Agency searched three premises of Coda Payments India Pvt Ltd. and informed in the report that the “company has collected Rs 2,850 crore till date, out of which Rs 2,265 crore was remitted outside India after retaining a certain percentage of revenue for the payment of taxes and nominal profits here”.
According to the Enforcement Directorate, “It is alleged that Coda Payments India Pvt. Ltd., which facilitates and collects payments from end users (mostly unsuspecting children) for games in the name of monetizing and generating revenue for web/game publishers, was resorting to unauthorized deductions from the end-users of these games in the name of selling digital tokens which were used by them (end users) to enhance their playing experience”. Some games that Coda Payments India Pvt Ltd (CPIPL) facilitates payments are Garena Free Fire, Call of Duty Mobile and Teen Patti, which had multiple FIRs registered against the payment company.
The Payment Transactions are designed in such a way in these games that after the first successful payment and authentication, a notification pops up, and subsequent transactions can be made without authentication on the same device. “As the children are not aware of these technical terms, they just click on the notification in a routine manner and end up giving the authorization to make all future payments without any further authentication,” the ED said, explaining the modus operandi of the alleged fraud.
The Publishers of the game Free Fire, “Garena,” incorporated CPIPL only to act as an agent of Coda Payments Singapore Pte. Ltd. for collecting money from the users and remitting it to the parent company as the company Garena does not have a company presence in India, and everything is operated from Singapore.
