BENGALURU: The Directorate of Enforcement (ED) has provisionally attached Rs 106 crore worth of assets in the Chinese loan app case, under the Prevention of Money Laundering Act (PMLA), the agency stated in an official release on Wednesday.
The ED initiated an investigation based on FIRs registered by the Cyber Crime police station, Bengaluru, under various sections of the Indian Penal Code, Karnataka Money Lenders Act, Information Technology Act and Karnataka Prohibition of Charging Exorbitant Interest Act against numerous entities/persons, for their alleged involvement in extortion and harassment of the public who had availed of small loans through mobile apps.
“The ED investigation revealed that the entities were incorporated by appointing dummy directors on behalf of some Chinese nationals, who used to obtain the Know Your Customer (KYC) documents of company staff, appoint them as directors of such entities and even opened bank accounts in their names without their knowledge or prior consent,” the Central agency stated.
“These entities were involved in illegal/criminal activities by submitting fake addresses in KYC documents and taking assistance from various professionals and other persons. They provided instant short-term loans to the public through loan apps and other means and charged them high processing fees and exorbitant rates of interest.
These companies recovered the money from the borrowers by threatening them and causing mental torture. They would even contact borrowers’ family members, relatives and friends, asking them for the money. These Chinese national-controlled entities indulged in money laundering activities through merchant IDs maintained with various payment gateways -- Razorpay, Cashfree, Paytm, PayU, Easebuzz and bank accounts maintained with various banks, and thereby generated proceeds of crime,” the ED added.