On May 25, 2023, the Directorate of Enforcement (ED) conducted searches at Pune and Ahmednagar in relation to FEMA violations by the VIPS Group of Companies and M/s Global Affiliate Business managed and controlled by Vinod Khute and his relatives. These searches resulted in the seizure/freezing of cash and bank balances totaling Rs. 18.54 Crore.
Vinod Khute and others are the subject of an investigation by the ED under the terms of FEMA, 1999. Vinod Khute currently resides in Dubai and is the brains behind a number of illegal trade, cryptocurrency exchange, and wallet services run by the VIPS Group of companies, with the proceeds being funnelled through Hawala to various foreign nations.
During the investigation, it was discovered that M/s Global Affiliate Business, an affiliate programme that promotes businesses through affiliate marketing by selling goods through E-Commerce Shopping Portals, was being run through an application called “Global Affiliate Business” that was accessible on both the Google Play Store and the Apple Store.
A commission on his investment or expense on the application is credited to his account or wallet if a person joins the programme as a member and refers other customers or clients to the application or website. However, it was discovered that M/s Global Affiliate Business has been operating an illegal and unauthorised multi level marketing scheme. This method has allowed for the collection of 125 crore rupees from various investors.
Additionally, it has been discovered that M/s Global Affiliate Business is promoting M/s Kana Capital’s brokerage activities, through which numerous clients trade stocks, cryptocurrencies, forex, and other commodities. In collaboration with the directors of the VIPS group of companies, M/s Kana Capitals also offers a variety of weekly training sessions for clients of M/s Global Affiliate Business on investing in VIPSWALLET, VIPSFINSTOCK for buying and selling stocks and cryptocurrencies, and how to entice other customers/clients into unauthorised and illegal multi-level marketing schemes.
Vinod Khute also recently launched M/s Dhanashree Multi State Co-op Credit Society Limited in Pune to entice investors with phoney investment opportunities. He was promising 2 to 4 percent interest per month.
Investigations revealed that M/s Global Affiliate Business had also collected cash investments totaling crores of rupees from a number of clients and investors, and that the money had been syphoned off through Hawala channels and various shell companies/firms.
A preliminary investigation has shown that more than Rs. 125 crore was obtained from a variety of investors on the pretence of an investment for the purpose of receiving interest or commission income. According to the provisions of FEMA, 1999, the ED further frozen a total of Rs. 17.22 crore in the form of bank balances over the course of its inquiry based on the money trail.
Therefore, the alleged activity led to the seizure/freezing of cash and bank balances of Rs. 18.54 Crore. Further research is now being conducted.
