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New Delhi: The Law Enforcement (ED) Directorate raided online payment gateways such as Razorpay, Cashfree, Paytm on Saturday as part of an ongoing investigation into the case of the chinese instant loan app.
The raids are currently underway at six premises in Bangalore. The case is based on 18 FIR numbers registered by the Bangalore City Cyber Crime Police Station.
Cases were registered against numerous entities and individuals in relation to their involvement in extortion and harassment of the public who had benefited from a small amount of loans through the mobile applications.
During preliminary investigations, the central investigative agency found that these entities were controlled and operated by Chinese people. “The modus operandi of these entities is to use fake Indian documents and make them bogus directors of these entities, they generate proceeds of crime,” the ED said.
The agency further stated that these entities carry out their illegal activities through various merchant IDs and accounts held with payment gateways and banks.
“The premises of Razorpay Pvt Ltd, Cashfree Payments, Paytm Payment Services Ltd and entities controlled/operated by Chinese persons are covered by the search operation,” he said.
During the search operation, the ED said, these entities were observed to generate proceeds of crime through various merchant IDs and accounts held with payment gateways. “…they also do not operate from the addresses given on the MCA (Ministry of Corporate Affairs) website/registered address and have fake addresses. An amount of 17 million rupees was seized in merchant IDs and bank accounts of these Chinese-controlled entities,” the ED said.
Responding to the raids, Cashfree Payments said in a statement that it provided diligent cooperation with emergency service operations, “providing them with required and necessary information on the same day of the investigation. Our operations and processes of onboarding complies with the PMLA and KYC guidelines, and we will continue to do so in the time to come.”
Razorpay’s spokesperson said some of its merchants were under investigation by law enforcement about a year and a half ago. “As part of the ongoing investigation, authorities have requested additional information to assist in the investigation. We have cooperated fully and shared KYC and other details. Authorities have been satisfied with our due diligence process” , did he declare.
Paytm also responded by saying it supports law enforcement, which investigates a specific set of merchants. “Authorities contacted us with instructions to provide certain information about these traders under surveillance, to which we promptly responded. We continue to cooperate with authorities and remain fully compliant,” the company spokesperson said.
