ED freezes ₹18.4 crore across 129 accounts in online investment fraud probe

The ED has frozen ₹18.4 crore linked to a money-laundering probe into a fake investment scheme that duped victims via social media and apps.

MUMBAI: The Enforcement Directorate (ED) has frozen bank funds worth ₹18.4 crore during search operations conducted across four states, including in Mumbai and Thane, as part of a money-laundering investigation into an alleged online investment fraud that duped investors through fake stock market and Initial Public Offering (IPO) schemes.

ED freezes ₹18.4 crore across 129 accounts in online investment fraud probe

According to the ED, victims were allegedly lured through social media platforms and WhatsApp groups with promises of high returns from investments in stock markets and IPOs. Investors were directed to use mobile applications such as ‘CHC-SES’, ‘ALICE’ and ‘ESCORTS’ for making investments.

Officials said the apps appeared to show substantial profits and growing returns after investments were made. However, when investors attempted to withdraw their money, they were allegedly prevented from doing so and were instead asked to pay additional amounts in the name of taxes and other charges.

The searches were carried out between June 1 and June 4 at eight locations in Mumbai, Thane, Bengaluru and Gurugram. The companies covered during the operation included Payx Digital Payment Pvt Ltd, Smoothpe Digital Pvt Ltd, Kinsen Business Solution Pvt Ltd, Safexpay Technologies Pvt Ltd, Gyan Kuber Ltd and Decentro Tech Pvt Ltd.

The money-laundering probe stems from multiple cases registered by the Cyber Crime Police Station under the Bidhannagar Police Commissionerate in West Bengal, which relate to alleged cyber fraud involving fake investment schemes. The agency is examining the role of various accused persons and entities suspected of facilitating the fraud.

According to the ED, its investigation has revealed that the proceeds of crime generated through the alleged cyber fraud were routed through a network of mule entities, charitable trust accounts and payment gateway companies.

“The transaction pattern indicated receipt of funds from suspected mule accounts, inter-layering of funds through multiple entities and transfer of large amounts through payment gateways, suggesting concealment and laundering of the proceeds of crime,” ED officials said.

The agency further claimed that the investigation had uncovered common directors, shared business premises, financial linkages and fund transfers among several of the entities under scrutiny.

“The investigation has further established that there were common directors, common business premises, financial linkages and fund transfers among several of these entities,” an ED official said.