Enforcement Directorate raided WazirX Director Sameer Mhatre, and issued a freezing order to freeze their Bank balances to the tune of INR 64.67 Crore according to ED’s website.
The Enforcement Directorate on August 3 conducted searches at the premises of one of the directors Sameer Mhatre of cryptocurrency exchange platform WazirX. The ED has frozen assets worth Rs 64.67 crores under PMLA, 2002.
In its money laundering probes against a number of Indian NBFCs and their fintech partners for lending practices that are in violation of guidelines issued by the Reserve Bank of India (RBI) and for using telecallers, who abuse borrowers to extort high interest rates from them, ED found a large amount of funds were diverted to purchase crypto assets and send them abroad.
ED observed that maximum amount of funds were diverted to WazirX exchange and crypto assets purchased were diverted to “unknown foreign wallets”.
ED also accused WazirX of giving “contradictory & ambiguous answers” and that WazirX failed to give the crypto transactions of the suspect fintech app companies and reveal KYC of the wallets.
ED said in a PR, “By encouraging obscurity and having lax AML norms, it has actively assisted around 16 accused fintech companies in laundering the proceeds of crime using the crypto route. Therefore, equivalent movable assets to the extent of Rs. 64.67 Crore lying with WazirX were frozen under PMLA, 2002.”
The Ministry of Finance had informed the Rajya Sabha on August 2 that the ED is investigating two cases against WazirX under the provisions of the Foreign Exchange Management Act, 1999 (FEMA). It had further said that Zanmai Labs was using the walled infrastructure of Binance.
The investigation of FEMA violation quoted by the minister was a year old investigation. Enforcement Directorate said today, that further investigation is going on.