ED raids WazirX director freezes 64.7 Cr in bank accounts

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New Delhi: One of the directors of Zanmai Lab Private Limited, which operates the well-known cryptocurrency exchange WazirX, has been wanted by the Enforcement Directorate. His bank balances of Rs 64.67 crore are to be frozen, according to a directive from the financial investigation agency.

In order to extort high interest rates from loan seekers, several Indian NBFCs and their fintech partners are being investigated by ED for money laundering. These companies engaged in predatory lending practices that violated RBI guidelines and used telemarketers that used abusive language and misused personal data.

Several fintech companies backed by Chinese funds failed to get NBFC license from RBI to do lending business. So they devised the MoU route with defunct NBFCs to grab their license.

After the criminal investigation began, many of these fintech apps have closed shop and diverted the huge profits made from the previous modus operandi. While conducting background investigation, ED found that fintech companies diverted huge amount of funds to buy crypto assets and then launder them abroad. These companies and virtual assets cannot be located at this time.

The financial investigation agency issued subpoenas to cryptocurrency exchanges. Most of the funds were seen to be transferred to the WazirX exchange and the cryptocurrency assets that were bought there were sent to unidentified international wallets. says ED.

The ED said: “Zanmai Labs Pvt Ltd, the company that owns WazirX Crypto Exchange, has created a network of agreements with – Crowdfire Inc. USA, Binance (Cayman Islands), Zettai Pte Ltd Singapore – to conceal ownership of crypto exchange Earlier its managing director Mr. Nischal Shetty had stated that WazirX is an exchange in India which controls all crypto-crypto and inr-crypto transactions and has only one IP deal and preference with Binance.

“But now, Zanmai claims that they are only involved in inr-crypto transactions, and all other transactions are done by Binance on WazirX. They are giving contradictory and ambiguous answers to evade the oversight of Indian regulatory agencies,” the central agency observed during the investigation.

All crypto-crypto transactions are controlled by Binance, which once again has no known office, no known employees, and only occasionally responds to inquiries at legal@binance.com. WazirX runs from a cloud based software (@AWS Mumbai), all employees work from home and the social office is a 2-chair co-working space from Wework.

WazirX repeatedly offered opportunities but never provided the cryptocurrency transactions of the questionable fintech APP companies or disclosed the KYC of the wallets. Most transactions are also not visible on the blockchain.

WazirX is powered by cloud-based software (@AWS Mumbai), all employees work from home, the social office is a 2-chair co-working space, and Binance controls all cryptocurrency transactions (despite having no known office , has no known employees and responds infrequently to emails sent to legal@binance.com).

WazirX failed to disclose crypto transactions of questionable APP fintech companies and KYC of wallets despite numerous opportunities to do so. On the blockchain, most transactions are also undocumented.



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