The Enforcement Directorate (ED) has seized ₹46.67 crore lying in various bank and virtual accounts in connection with a money laundering probe involving the HPZ Token app that allegedly promised its users large gains against investments in mining machines for bitcoin and other cryptocurrencies.
During the searches in the case, which is based on a FIR registered by the Cyber Crime Police of Nagaland’s Kohima in October last year, the ED covered six business and residential premises in Delhi, Ghaziabad, Mumbai, Lucknow and Gaya. Besides, 16 other locations of banks, payment gateway branches and offices in Delhi, Gurugram, Mumbai, Pune, Chennai, Hyderabad, Jaipur, Jodhpur and Bengaluru were also searched.
Following the money trail, the agency detected ₹33.36 crore that was lying with the Easebuzz Private Limited in Pune, ₹8.21 crore with Razorpay Software in Bengaluru, ₹1.28 crore with Cashfree Payments in Bengaluru, and ₹1.11 crore with Paytm Payments in Delhi.
According to the ED, the victims were lured into undertaking investments on the pretext of doubling their money via the app. Payments were received through UPIs and various other gateways. Some amounts were paid back to the investors and the remaining diverted to various individual and company accounts, while a part of the funds was siphoned off in the form of digital/virtual currencies. Subsequently, the fraudsters stopped the payments and the website became inaccessible.
The agency found that the app was being operated allegedly by Lillion Technocab and Shigoo Technology Private Limited. “Shigoo Technology Private Limited was also found linked to various Chinese-controlled companies...several other companies were receiving funds from the public on the pretext of operating various apps, websites for gaming, and loans,” an ED official said.
“The ED suspected the link of Gurugram-based Jilian Consultants India Private Limited with the entities involved in the frauds. One such entity, Mad-Elephant Network Technology, in agreement with X10 Financial Services, was operating various loan apps such as Yo-Yo Cash, Tufan Rupees, Coco Cash, etc.. Similarly, Su Hui Technology, in agreement with Nimisha Finance India, had operated loan apps,” the official said.
Responding to the development, an Easebuzz spokesperson said: “...none of the parties mentioned in the ED’s statement belonged to our merchant base. The mentioned entities by authorities were only the counterparties of the merchant, who was using our payment gateway and this merchant had been proactively identified and blocked by us much before the investigation had started, as per our internal risk and compliance process...”
The Cashfree Payments’ spokesperson said: “We continue to extend our diligent cooperation to the ED’s operations. We were able to provide the required and necessary information within a few hours on the day of enquiry. The operations and on-boarding processes of Cashfree Payments are fully compliant with existing regulations.”
Last week, the Serious Fraud Investigation Office had arrested a “mastermind” behind several Chinese shell companies operating in the country. On September 8, it had carried out a search-cum-seizure operation at the Gurugram and Bengaluru offices of Jillian Consultants, a wholly-owned subsidiary of Jilian Hong Kong Limited. A Hyderabad-based company named Husys Consulting Limited, earlier listed on the stock exchanges, was also probed.