Indian Government Raids Director of Binance-Owned Crypto Exchange WazirX, Freezes $8.14M
India's Enforcement Directorate (ED), has raided properties related to Sameer Mhatre, director of Binance-owned crypto exchange WazirX.
The action is related to ongoing investigations by the ED against several fintech companies regarding an instant loan app fraud.
WazirX "actively assisted around 16 accused fintech companies in laundering the proceeds of crime using the crypto route," said the ED in a press release. "Therefore, equivalent movable assets to the extent of Rs. 64.67 Crore lying with WazirX were frozen under PMLA, 2002," the agency continued.
Despite being given "repeated opportunities," said the ED, the WazirX director has taken an "uncooperative stand."
"WazirX failed to give the crypto transactions of the suspect fintech APP companies and reveal the KYC. a search operation was conducted under PMLA on 3.8.2022 and it was found that Mr Sameer Mhatre, Director WazirX, has complete remote access to the database of WazirX, but despite that he is not providing the details of the transactions relating to the crypto assets, purchased from the proceeds of crime of Instant Loan APP fraud," the press released continued.
According to the ED, various fintech companies backed by Chinese funds were unable to get authorization from India's central bank and therefore turned to the crypto route.
On Tuesday, India's Ministry of Finance announced that it was investigating two cases against WazirX under the Foreign Exchange Management Act (FEMA), with allegations that it used Binance to disguise transactions.
“It has been found that all crypto transactions between these 2 exchanges were not even being recorded on the blockchains and were thus cloaked in mystery," the Ministry added, as quoted in MoneyControl.