OctaFx India Pvt.Ltdhas been accused by the AML watchdog ED for performing illegal forex trading.
WHAT IS DIRECTORATE OF ENFORECEMENT?
The Directorate of Enforcement is regarded as a multi-disciplinary organization that investigates the illegal money laundering activities as well as violates the foreign exchange laws. mandated with investigation of offence of money laundering and violations of foreign exchange laws. The statutory functions of the Directorate include enforcement of the following: Prevention of Money Laundering Act,2002, Foreign Exchange Management Act,1999, Fugitive Economic Offenders Act,2018, Foreign Exchange Regulation Act,1973 and Sponsoring agency under COFEPOSA.
WHAT IS FOREX TRADING?
The forex trading means it is an decentralized trading of the currency that takes place. It defines the forex rate according to each and every currency. It shows the buying, selling that is taking place in the currency.
The foreign exchange market, commonly referred to as the Forex or FX, is regarded as the global marketplace for the trading of one nation’s currency for another. The forex market is the largest, most liquid market in the world, with trillions of dollars changing hands every day.
What is Forex Market?
Forex Market is the largest liquid financial market in the world. For forex market there is no defined central marketplace for trading. It is also known as Over the counter Market.
Understanding the OctaFx case
ED initiated investigation at various premises of M/s OctaFx India Pvt. Ltd. And related concerns under the provisions of FEMA. The case relates to illegal online forex trading through International Brokers i.e. OctaFx Trading App and its website.
The investigation revealed that the online app and website operated in India through the association of India based entity M/s OctaFx India Pvt.Ltd. This trading platform is promoted on social networking sites and follow referral based incentive model. The funds are collected through UPI or local bank transfers from the users and are further to dummy entities. Further connection between the international online forex trading broker and Indian partner was revealed, the conduct and operation of forex trading is illegal and violates FEMA Regulations.
The investigation developed that the multiple and different Indian bank accounts were shown to users for collecthing funds and the said funds after defrauding users were transferred to multiple e-wallet accounts or to dummy entities bank accounts.
Aftermath of OctaFx Case
The major portion of the defrauded amount was used to purchase crypto currencies or assets throung M/s Zanmai Labs Pvt. Ltd. M/s Zanmai labs is banking channel and a bridge to deposit the INR to Wazirx wallets which ultimately transferred to Binance exchange. This lead to transfer the Indian currency to overseas entities in the crypto currencies form.
