New Delhi [India], June 2 : The Enforcement Directorate conducted searches at Pune and Ahmednagar in late May in connection with Foreign Exchange Management Act violations by VIPS Group of Companies and Global Affiliate Business managed and controlled by one Vinod Khute and his relatives.
Searches have resulted in the seizure or freezing of cash as well as bank balances amounting to Rs18.54 crore.
The enforcement agency had initiated an investigation under FEMA against them, who is presently residing in Dubai and what the agency termed as the mastermind of various illegal trade, crypto exchange, and wallet services being operated through the VIPS Group of companies.
The proceeds were being siphoned off through 'Hawala' transactions to various foreign countries.
During the investigation, ED said it has come to light that Global Affiliate Business, which is an affiliate programme, that markets business in affiliate marketing by selling products through an E-commerce shopping portal, was being operated through an application namely "Global Affiliate Business".
However, it was revealed that Global Affiliate Business has been running illegal and unauthorized multi-level marketing schemes wherein if a person opts for the scheme as a member and refers other consumers to the application, a commission on his investment on the application is credited to his account.
"In this manner, funds to the tune of Rs 125 Crore have been collected from various investors," ED said.
Further, M/s Global Affiliate Business has also been found to be marketing the business of M/s Kana Capital which is engaged in brokerage under which various clients trade forex, crypto, stocks etc. M/s Kana Capitals in consultation with directors of the VIPS group of companies also conduct various weekly training programmes for clients of M/s Global Affiliate Business for investment in various financial assets, and how to lure other consumers.
Further, M/s D Dhanashree Multi-State Co-op Credit Society Limited, Pune is another venture recently floated by Vinod Khute to lure investors in fake schemes wherein he was offering 2 per cent to 4 per cent interest per month, the ED said.
Further investigation is under progress.
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