The Enforcement Directorate on Friday said it has filed a charge sheet against payment gateway Razorpay, three fintech companies controlled by Chinese nationals and as many NBFCs and some others in a money laundering probe linked to Chinese loan apps which allegedly cheated numerous people.
The federal probe agency said in a statement that the special Prevention of Money Laundering Act (PMLA) court based in Bengaluru has taken cognisance of the prosecution complaint (chargesheet).
A total of seven entities and five individuals have been named as accused in the charge sheet.
The accused entities include fintech companies Mad Elephant Network Technology , Baryonyx Technology and Cloud Atlas Future Technology which are “controlled” by the Chinese nationals and three non-banking financial companies (NBFCs) registered with RBI named X10 Financial Services, Track Fin-ed and Jamnadas Morarjee Finance.
Razorpay Software has also been named in the charge sheet as an accused, the agency said.
Money laundering case
The money laundering case of the ED stems from multiple FIRs of the Bengaluru Police CID which were filed based on complaints received from various customers who had availed loans and “faced harassment” from the recovery agent of these money-lending companies.
According to the ED, the probe found that fintech companies had "agreement with respective NBFCs for disbursement of loans through digital lending apps".
"The money-lending business was being illegally run by these fintech companies actually and these NBFCs knowingly let these firms use their names for the sake of getting commission without being careful about their conduct. The same is also a violation of the fair practices code of the Reserve Bank of India," the agency said.
The agency earlier had issued two provisional attachment orders to freeze ₹77.25 crore worth funds kept in bank accounts and payment gateways which was later confirmed by the Adjudicating Authority of the PMLA.
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