Fraud case: Indians who were hired abroad by forex trading platform OctaFX under ED’s scanner

ED's probe into forex trading platform OctaFX reveals hiring of Indians abroad to operate illegal platform, freezing assets worth ₹80.43 crore.

MUMBAI: The Enforcement Directorate (ED)’s money laundering investigation against forex trading platform OctaFX, accused of defrauding investors to the tune of several crores, has revealed that it had hired several Indian citizens abroad to operate the illegal platform.

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The agency recently froze movable assets worth ₹80.43 crore during searches conducted at various locations in Mumbai, Kolkata, Delhi and Gurugram under the provisions of the Prevention of Money Laundering Act (PMLA), 2002.

ED’s probe revealed that OctaFX hired several Indians in Spain and Russia to run its trading platform and lure Indian citizens into investing in forex trading through their platform. Forex trading, short for foreign exchange trading, involves buying and selling currencies with the aim of making a profit from fluctuations in exchange rates.

The agency will record statements of such individuals as part of the probe, the agency sources said. The ED started its investigation based on a case registered by the Shivaji Nagar police station in Pune against several persons for their alleged involvement in entrapping and duping investors on the pretext of earning high returns via forex trading through the OctaFx trading app and website.

The entities allegedly earned a profit of more than ₹1,000 crore from India in the process, ED sources said. A portion of these funds were allegedly layered through a web of complex transactions with the help of shell companies. The funds were then remitted abroad allegedly to related entities in the name of bogus freight services and import of services, sources said.

ED’s investigation revealed that the OctaFx online trading app and website operated in India in association with an entity within the country. According to ED, the app (OctaFX) and its website have not been authorised by RBI to deal with forex trading. The forex trading platform was widely promoted on social networking sites and allegedly followed a referral-based incentive model for acquiring users to their platforms.

It emerged in the investigation that multiple accounts of different Indian banks were allegedly being shown to investors/users on the OctaFx trading app/site for collecting funds in the guise of facilitating forex trading. The probe also revealed that the OctaFx allegedly manipulated trade activities and information shown on its platform ultimately resulting in net loss to the traders. The said accumulated funds, after defrauding these investors/users, were allegedly transferred to multiple e-wallet accounts or to bank accounts of dummy entities.