The Enforcement Directorate on Saturday conducted raids at the Bengaluru offices of payment platforms Razorpay, Cashfree and Paytm as part of an investigation into illegal phone-based loan apps operated or controlled by Chinese individuals.
The raids, which started on Friday, were conducted at six locations in the city under the provisions of the Prevention of Money Laundering Act.
The Chinese loan apps case is based on 18 first information reports filed by Cyber Crime department of the Bengaluru Police against unknown persons, the central agency said in a statement. The perpetrators allegedly extorted and harassed users who took small loans through mobile apps run by them.
“During enquiries, it has emerged that these entities are controlled or operated by Chinese persons,” the Enforcement Directorate said. “The modus operandi of these entities is by using forged documents of Indians and making them as dummy directors of those entities, they are generating proceeds of crime.”
These entities were carrying out an illegal business through various accounts held with payment gateways and banks, it said. The entities have also been accused of running their businesses from locations not registered with the Ministry of Corporate Affairs.
The agency said that it has seized Rs 17 crore deposited in “merchant IDs and bank accounts of these Chinese persons-controlled entities”.
In a statement issued after the raids, Razorpay claimed that the authorities had asked the company for some additional information on the investigation.
“A few of our merchants were being investigated by law enforcement about a year and a half back,” the company said. “We have fully cooperated and shared KYC [know your customer] and other details.”
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