ED probes Paytm, Razorpay, others over crypto scam worth ₹2,200cr
24 Jan 2025

India's Enforcement Directorate (ED) is now investigating some of the most popular payment gateways, including Paytm, Razorpay, PayU, and Easebuzz.

The probe focuses on their alleged role in a massive cryptocurrency scam run by 10 Chinese nationals via the HPZ Token app, according to The Times of India.

As part of the investigation, the ED has frozen around ₹500 crore in these companies' virtual accounts over the last two years.

Scam involved cryptocurrency mining investments across 20 states
Scam details

The alleged fraudsters are accused of duping people across 20 Indian states, collecting over ₹2,200 crore and transferring the proceeds abroad.

A portion of this money, around ₹500 crore, was frozen by ED while it was held with payment gateways for 1-2 days before being sent.

The ED's investigation revolves around tracing the money trail and ascertaining if payment gateways had generated suspicious transaction reports (STRs), and alerted the Reserve Bank of India (RBI) and the Financial Intelligence Unit (FIU).

Breakdown of frozen funds in payment gateways' accounts
Frozen assets

Of the total ₹497 crore frozen in the virtual accounts of payment gateways, PayU held the largest share at ₹130 crore.

It was followed by Easebuzz with ₹33.4 crore, Razorpay with ₹18 crore, CashFree with ₹10.6 crore, and Paytm with ₹2.8 crore.

Other payment gateways where ED has frozen alleged scam money include WunderBaked, AgreePay, and SpeedPay.

Cryptocurrency scam operated through companies across India
Scam operations

The alleged culprits ran a nationwide racket with companies registered in at least 20 states.

Investors were promised the chance to invest in cryptocurrency mining, including Bitcoins, through the HPZ Token mobile app.

More than 50 companies were registered in Delhi alone, with many others across states like Karnataka, Haryana, Uttar Pradesh, Maharashtra, Gujarat, Andhra Pradesh, Telangana, Tamil Nadu, and West Bengal.

ED declares Delhi resident as fugitive economic offender
Fugitive offender

In related developments, a PMLA court in Nagaland declared Bhupesh Arora, a Delhi resident, a fugitive economic offender on January 22.

The declaration came after Arora failed to appear before the agency despite a non-bailable warrant against him.

The ED alleges Arora fled to Dubai in 2022 when the investigations into the scam began.