ED Questions Tamannaah Bhatia In HPZ Token Money Laundering Probe

The Enforcement Directorate (ED) has reportedly questioned actor Tamannaah Bhatia in connection with an alleged crypto scam linked to the HPZ Token app, through which a large number of investors were cheated on the pretext of high returns.

The development comes after the ED launched a money laundering probe into the HPZ Token app that allegedly misled the public into investing in non-existent mining machine rentals. 

Bhatia had made a “celebrity appearance” at an event of the app in exchange for money, though there were “incriminating” charges against her, the Indian Express reported, citing sources.

The ED probe is based on a first information report registered by the cyber crime police of Nagaland’s Kohima in October 2021 against the HPZ Token app and others linked to the scam.

The agency alleged that fraudsters used the app to entice victims to invest in the HPZ token app with the promise of huge returns against investments in crypto-mining machines for Bitcoin and other digital currencies.

As of May 2024, the ED froze assets worth INR 177 Cr, including INR 56 Cr in bank accounts held by various shell and Chinese linked entities in connection with the HPZ Token app scam case.

The ED investigation found that these China-linked entities entered into service agreements with several NBFCs and were allegedly operating multiple suspicious online lending apps such as Cashhome, Cashmart and easyloan. 

These apps were then used to rotate and layer the funds fraudulently received for illegal online gaming, betting and investments for Bitcoin mining.

As per media reports, the app promised returns of as much as INR 4,000 per day for three months on an investment of INR 57,000.

The ED is not the only central investigating agency probing the alleged scam related to the HPZ Token app. Earlier it was reported that the central bureau of investigation (CBI) raided more than two dozen locations across the country in connection with the case and seized mobile phones, computer hard drives, SIM cards, debit cards, and various documents.

The development comes at a time when ED is cracking down on Chinese digital lending apps for allegedly flouting money laundering and foreign exchange management laws.

In the previous instance, offices of major payment gateways and other fintech players including Pune-based Easebuzz, Razorpay, Cashfree Payments India, and Paytm were raided.

Earlier this year, ED seized frozen crypto assets worth INR 90 Cr, kept in wallets of Binance, ZebPay and WazirX, in connection with a money laundering case involving online gaming app E-Nugget.

Further, multiple government agencies are probing crypto exchange WazirX and its executives after $234 Mn were allegedly stolen from one of its multisig wallet.