New Delhi [India], May 24 : Enforcement Directorate (ED) on Wednesday carried out search and seizure operations at 25 premises in a FEMA violations case lodged against foreign registered Online Gaming companies and websites operating in India.
The ED probe suggests that more than Rs 4000 crores were sent abroad through shell firms.
Raids were conducted at eleven locations in Delhi, seven locations in Gujarat, four locations in Maharashtra, two locations in Madhya Pradesh and one location in Andhra Pradesh.
These online gaming companies/websites are registered in small island countries like Curacao, Malta and Cyprus. However, all of them are linked to Indian Bank Accounts opened in the name of proxy persons who have no links to online gaming activity, as per an official statement.
According to the statement, the amount so collected from the general public through gaming websites is then routed through multiple bank accounts and finally remitted out of India by mis-declaring the purpose of remittances against the import of services.
Remittances out of the income from racing or riding, or any other hobby are not allowed under the provisions of FEMA.
Searches were conducted at premises linked to several Hawala operators namely Ashish Kakkar, Neeraj Bedi, Arjun Ashwinbhai Adhikari, Abhijeet Khot and the persons and entities associated with them.
Searches have resulted in the seizure of several incriminating documents, electronic evidence related to the case and the revealing of interesting modus adopted by them to evade investigative agencies.
Hundreds of companies have been opened by key persons in the name of their employees for layering and sending remittances to the tune of Rs 4000 crore in the guise of payments for the import of goods and services.
Several PAN cards, Aadhar cards used for creating such firms, mobiles used for operating bank accounts of these firms and office stamps were also found and seized.
Key persons were found using international virtual mobile numbers for instant messaging apps like WhatsApp, Telegram, and Signal, and using pseudo-names such as Pablo, John, and Watson for masking their actual identity.
To escape themselves from investigating agencies, they were using remote-based servers and laptops which are being used through remote access apps like Anydesk, and TeamViewer.
Two remotely accessed laptops have also been recovered and seized from the premises of an entity providing server services located far away from the actual operational places.
Seizures made during searches include incriminating documents and electronic devices establishing foreign outward remittances of thousands of crores collected from the public through gaming websites using accounts of dummy firms opened in the name of proxy persons who are not linked with the gaming activities, Rs 19.55 lakh in cash, 2695 US dollars and 55 bank accounts of firms being used for layering and remitting income generated from online gaming in the guise of remittances against the import of goods and services have also been frozen.
Further investigation into the matter is underway.
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