Prominent Indian crypto exchange WazirX has refuted the money laundering allegations that were insinuated in ED’s press release yesterday. The press release said that the agency had conducted searches on one of the Directors of M/s Zanmai Lab Pvt Ltd, which owns WazirX, and issued a freezing order to freeze their Bank balances to the tune of INR 64.67 Crore. Why Did ED Freeze WazirX’s Bank Accounts? The ED press release said that the action against WazirX is part of its money laundering investigation against non-bank financial companies (NBFC) and their fintech partners for predatory lending practices in violation of the RBI guidelines. Various fintech companies backed by Chinese funds could not get an NBFC license from RBI for carrying out lending business. So, they devised the MoU route with defunct NBFCs to piggyback on their license. It also said that after the criminal investigation began, many of these fintech APPs shut shop and diverted away the huge profits earned using the above modus operandi. While doing a fund trail investigation, ED found that a large chunk of funds was diverted by the fintech companies to purchase crypto assets and then launder them abroad. WazirX Refutes Money Laundering Allegations Refuting the money-laundering allegations, WazirX said that they have been fully cooperating with the Enforcement Directorate for several days and have responded to all their queries with the utmost transparency. The...
