In the Chinese Loan App Case, the Directorate of Enforcement (ED) has provisionally attached moveable assets worth Rs. 106 Crore. The ED launched an investigation based on FIRs filed by the Cyber Crime Police Station in Bengaluru under various sections of the Karnataka Money Lenders Act, 1961, the Information Technology Act, 2000, the Karnataka Prohibition of Charging Exorbitant Interest Act, 2004, and various sections of the Indian Penal Code, 1860, against a number of entities/persons in connection with their involvement in extortion and Harassment of members of the public who had obtained modest loans using mobile applications operated by Chinese national owned entities/persons.
The ED investigation revealed that these entities were formed by appointing dummy directors on behalf of Chinese nationals, used to obtain KYC documents of company employees and appoint them as Directors of such entities, and even opened bank accounts in their names, all without their knowledge or prior consent. These companies engage in illegal/criminal operations by presenting forged addresses in KYC papers and enlisting the support of numerous experts and other individuals.
They have provided instant short-term loans to the public through Loan apps and other means, charging high processing fees and exorbitant rates of interest, and the amounts were later recovered from the public by these companies by threatening and torturing the borrowers of the loans over the phone, as well as contacting their family members, relatives, and friends, asking for the money.
These Chinese national-controlled businesses have engaged in massive money laundering operations using merchant IDs from multiple payment gateways, Razorpay, Cashfree, Paytm, PayU, Easebuzz, and bank accounts from numerous banks, earning criminal gains. Under the PMLA, a total of Rs 106 crore has been attached in merchant IDs and bank accounts. Further research is being conducted.
