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“Lax KYC standards, loose regulatory scrutiny of transactions between WazirX and Binance, not recording transactions on the blockchain to save costs, and not recording KYC of counterparty wallets have ensured that WazirX is unable to provide any account. missing crypto assets,” ED said in a statement.
The Enforcement Directorate (ED) on Friday said it has frozen bank deposits of ₹64.67 crore as part of its money laundering probe against cryptocurrency exchange WazirX.
The federal agency said it conducted raids against the director of Zanmai Lab Pvt. Ltd., which owns WazirX, on August 3 in Hyderabad and claimed that it was “not cooperating”.
The agency’s investigation against the crypto exchange is related to its ongoing investigation against a number of Chinese credit applications (mobile apps) operating in India.
Last year, the agency charged WazirX with alleged violations of the Foreign Exchange Management Act (FEMA).
“Sameer Mhatre, director of WazirX, was found to have full remote access to the WazirX database, yet he did not provide details of transactions related to crypto assets purchased from the proceeds of the instant loan app fraud. .”
“Lax KYC standards, loose regulatory scrutiny of transactions between WazirX and Binance, not recording transactions on the blockchain to save costs, and not recording KYC of counterparty wallets have ensured that WazirX is unable to provide any account. missing crypto assets,” ED said in a statement.
The company said it made no attempt to trace these cryptoassets. “By fostering obscurity and lax AML (Anti-Money Laundering) standards, it actively assisted approximately 16 accused fintech companies in laundering the proceeds of crime using the crypto route,” the company said.
Therefore, the ED said, the equivalent movable property to the extent of ₹ 64.67 crore lying with WazirX has been frozen under the Prevention of Money Laundering Act (PMLA).
