New Delhi: After the Directorate of Enforcement (ED) raided one of its directors and froze bank balances to the tune of Rs 64.67 crore, cryptocurrency exchange WazirX reiterated that the company’s operations are being conducted as usual and crypto and rupee withdrawals are being processed normally.
“In light of recent news about WazirX, we wanted to assure you that operations are being conducted as usual,” the crypto exchange tweeted on Sunday evening. Earlier, on Saturday, the crypto exchange said it was “fully cooperating” with the ED for “several days and have responded to all their queries fully and transparently.”
Further, it said the company do not agree with the allegations slapped by the ED, and it was evaluating a “further plan of action”.
The enforcement agency on Friday said it conducted searches on one of the directors of Zanmai Lab Pvt Ltd, which owns WazirX, and has issued the freezing order of their Bank balances.
Because of the non-cooperative stand of the Director of WazirX exchange, a search operation was conducted under the Prevention of Money Laundering Act (PMLA) on 3rd August 2022 and it was found that Sameer Mhatre, Director of WazirX, has complete remote access to the database of WazirX, but despite that he is not providing the details of the transactions relating to the crypto assets, purchased from the proceeds of crime of Instant Loan APP fraud, ED had said.
The lax KYC norms, loose regulatory control of transactions between WazirX & Binance, non-recording of transactions on Blockchains to save costs and non-recording of the KYC of the opposite wallets has ensured that WazirX is not able to give any account for the missing crypto assets.
It has made no efforts to trace these crypto assets. By encouraging obscurity and having lax AML norms, it has actively assisted around 16 accused fintech companies in laundering the proceeds of crime using the crypto route. Therefore, equivalent movable assets to the extent of Rs 64.67 crore lying with WazirX were frozen under PMLA, 2002, the enforcement agency said.
Importantly, the enforcement agency has been conducting a Money Laundering investigation against a number of Indian non-banking finance companies (NBFCs) and their fintech partners for predatory lending practices in violation of the RBI guidelines and by using tele-callers who misuse personal data and use abusive language to extort high-interest rates from the loan takers.