Locals were hired and used to open accounts with HSBC Bank

Guwahati: After raiding 15 locations across Delhi, Mumbai, Pune, Gurgaon, the Enforcement Directorate (ED) froze Rs 46.96 crore in four banks, say reports. This was after some companies were allegedly found running illegal online betting apps that were linked to China.

ED in a statement also said that the chartered accountants of these firms were also raided. “Searches were conducted on the registered offices of the companies, their directors and chartered accountants involved in illegally running online betting apps from websites which are hosted from outside India,” ED added.

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ED also said that during the course of the search they were able to identify multiple bank accounts which were mostly held at HSBC bank. Further analysis of two bank accounts of Dokypay Technology Pvt Ltd has revealed that in the last year alone the account has witnessed a collection of Rs 1,268 crore out of which Rs 300 crore came via Paytm payment gateway and around Rs 600 crore was transferred out via the same.

Under the Prevention of Money Laundering Act, the ED also launched a probe based on FIR’s filed by the cybercrime division of Hyderabad Police against Dokypay Technology Pvt Ltd, Linkyun Technology Pvt Ltd, and others. Additionally, three accused have been identified as Yan Hao 24, manager of Beijing Tomorrow Power Company, Dhiraj Sarkar, and Ankit Kapoor.

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ED in the statement also said, “During investigation, it is revealed that with the help of some Indian chartered accountants, some Chinese nationals floated multiple Indian companies. Initially, dummy Indian directors were used to incorporate the companies and, after some time, Chinese nationals travelled to India and took directorship in these companies.”

On top of that, some locals were also hired and used to open bank accounts with HSBC Bank and also open trade accounts with online wallets, namely Paytm, Razorpay, Cashfree, etc. These online wallets, on the other hand, had lax due diligence mechanism and their non-reporting of suspicious transactions to the regulatory authorities. This helped the accused companies to launch pan-India operations said ED.

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They added, “Once bank accounts were opened, internet access credentials were couriered by the Indian employees to China and major payment instructions came from the beneficial owners who were safely ensconced in China. Accused companies floated large number of similar looking websites which were hosted through Cloudfare, USA. These websites attracted gullible persons to become members and to place bets on various online apps, which promised attractive rewards on simple games of chance.”

Additionally, Paytm and Cashfree were used to collect money and pay commission to agent members said the probe agency. Under the garb of e-commerce, hundreds of websites were created to promote online betting. Moreover, not all websites were activated on a daily basis as some were activated for placing bets and the information on daily active websites was shared with members using Telegram groups said the ED.

This comes in the time when India responded to China’s aggression near the borders by curbing trade relations with Chinese firms, blocking various China-owned apps, and allowing room for domestic firms to grow.

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