India: Paytm, Razorpay, other loan apps raided by Enforcement Directorate

The Enforcement Directorate (ED) on Friday carried out search operations at six premises in Bengaluru in respect to an investigation relating to a Loan App case.

The federal agency conducted the raids under provisions of the Prevention of Money Laundering Act (PMLA), 2002, the agency said on Saturday.

The premises of Razorpay Pvt Ltd, Cashfree Payments, Paytm Payment Services Ltd and entities controlled and operated by foreign entities were covered in the search operation, said the ED.

During the search operation, ED said, it was noticed that the entities raided were generating proceeds of crime through various merchant IDs, accounts held with payment gateways and banks. They are also not operating from the addresses given on the MCA website or registered addresses and have fake addresses.

"An amount of Rs170 million have been seized in merchant IDs and bank accounts of these entities," said the agency.

The case is based on 18 FIRs registered by Cyber Crime Police Station, Bengaluru City against numerous entities and persons in connection with their involvement in extortion and harassment of the public who had availed small amounts of loans through the mobile apps being run by those entities and persons.

"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," said the ED.

"It has come to notice that the said entities were doing their suspected and illegal business through various Merchant IDs and Accounts held with payment gateways and banks."

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