ED attaches Rs 40.64 cr in mobile application fraud case

The Directorate of Enforcement (ED) provisionally seized movable property worth Rs 40.64 crore under the provisions of the Prevention of Money Laundering Act (PMLA) in a case related to a fraud committed by a number of questionable merchants by channeling transactions through fraudulent mobile applications using the services of payment solution providers.

The ED had opened an investigation for money laundering on the basis of an FIR dated June 1, 2021, registered by the Karnataka police at the cybercrime police station, CID Bengaluru under article 420 of the Code. Indian criminal (cheating). In the FIR, it was alleged that the accused entities had incited the public to

to invest through Powerbank / Sunfactory applications making sure to pay interest on a daily or weekly basis, the ED said in a statement.

“The accused entities shut down their alleged business after raising a huge amount of money from the gullible public. The accused entities neither paid interest nor returned the principal amount to the public and withheld the investment made by the public through Powerbank and other such fraudulent applications, resulting in a cheating commission ”, did he declare.

The ED’s money laundering investigation revealed that the accused entities accepted investments of over Rs 300 crore by setting up a merchant account in the name of a seemingly legitimate business and used the solutions of payment gateways and payment solutions companies, he said.

The accused entities have strayed from their stated line of business / activity and raised money from the public by floating unsustainable investment programs through an app listed on Google Playstore, he added.

The funds were paid into the bank accounts of the accused entities after collecting them from the public on behalf of the investment using the illicit use of services provided by payment aggregators.

As a result, movable assets identified in the form of bank balances and amounts withheld from payment solution providers in the amount of Rs 40.64 crore were provisionally seized under the PMLA, he added.

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