ED Has Seized INR 936 Cr In Relation With Cryptocurrency Frauds: Govt

The Enforcement Directorate (ED) has seized proceeds worth INR 936 Cr in relation with various cryptocurrency frauds as on January 31, 2023, the government informed the Parliament.

The ED is investigating several cases related to cryptocurrency frauds wherein a few crypto exchanges have also been found involved in money laundering. Necessary action as per the provisions of Prevention of Money Laundering Act, 2002 (PMLA) has been taken by the investment agency, Minister of State (MoS) for Finance Pankaj Chaudhary said in a written reply in the Lok Sabha.

“As on 31.01.2023, proceeds of crime amounting to INR 936 Cr have been attached/ seized/ freezed, 05 persons have been arrested and 06 prosecution complaints (PCs) including 01 supplementary PC have been filed before the Special Court, PMLA in these cases,” Chaudhary added.

Pointing out WazirX, the MoS said that assets totalling nearly INR 290 Cr belonging to the crypto exchange have been seized under FEMA.

“Further, under Foreign Exchange Management Act, 1999 (FEMA) assets amounting to INR 289.28 Cr have been seized under section 37A of FEMA and 01 Show Cause Notice to cryptocurrency exchange Zanmai Labs Pvt Ltd, known as WazirX and its directors under FEMA for transactions involving cryptocurrencies worth INR 2790 Cr has also been issued,” the minister said.

Reiterating the government’s stance on crypto regulations in the country, Chaudhary said that crypto assets are by definition borderless and require international collaboration to prevent regulatory arbitrage.

Any legislation for regulation or for banning can be effective only with significant international collaboration on evaluation of the risks and benefits and evolution of common taxonomy and standards, he added.

Last week, Economic Affairs Secretary Ajay Seth said that India is working with the Financial Stability Board (FSB) to reach a consensus on regulating cryptocurrencies during the country’s G20 presidency itself.