The Enforcement Directorate has conducted fresh raids at multiple locations belonging to payment gateways Paytm and PayU in connection with the transactions with shell firms of China. Following the raids, the agency asked Paytm to freeze certain amounts from a few Merchant IDs (MIDs), reports said. The raids were conducted in Mumbai, Delhi, Gurugram, Lucknow and Kolkata.
The federal agency had first started searching the premises of these companies on September 2, while the fresh raids were conducted on Wednesday, in connection with “illegal” Chinese loan app case.
On September 3, raids were conducted at the premises belonging to online payments gateways including Razorpay Pvt Ltd, Cashfree Payments and Paytm Payment Services Ltd, after which the probe agency seized Rs 17 crore worth funds kept in “merchant IDs and bank accounts of these Chinese persons-controlled entities”, it said in an official statement.
The ED has not issued statement regarding the fresh raids.
A Paytm spokesperson said that as part of the ongoing investigations of a specific set of merchants, the ED has sought information regarding such merchants to whom they provide payment processing solutions.
“As we have mentioned before, ED continues to seek information about certain merchants from various payment service providers, we have shared the required information.”
“These merchants are independent entities, and none of them are our group entities. We are, and will continue to, fully cooperate with the authorities, and all the directive actions are being duly complied with,” said the Paytm spokesperson.
The ED has instructed Paytm to freeze certain amounts from the Merchant IDs of a specific set of merchant entities (as mentioned by the ED in its press release).
“None of the funds which have been instructed to be frozen belong to Paytm or any of our group companies. As we have mentioned before, ED continues to seek information about certain merchants from various payment service providers, and we have shared the required information,” the Paytm spokesperson said.
The case is based on 18 FIRs registered by the Cyber Crime Police Station, Bengaluru City, against numerous persons for their involvement in extortion and harassment of the public who had availed small loans through the mobile apps being run by those entities.
“During enquiries, it had emerged that these entities are operated by Chinese persons. The modus operandi of these entities is that by using forged documents of Indians and making them dummy directors of those entities, they are generating proceeds of crime,” the ED said.
The ED had said that it has come to its notice that the entities were conducting their suspected business through various Merchant IDs/Accounts held with Payment Gateways/banks.
The premises of Razorpay Pvt Ltd, Cashfree Payments, Paytm Payment Services Ltd and entities controlled/operated by Chinese persons were covered in the search operations.
(With IANS inputs)
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