Indian Enforcement Clamps Down On 8 Chinese Firms, Freezes $6.9M

• Indian Enforcement Directorate froze account balances of various Chinese-controlled entities.
• The companies were alleged of misusing token app-based token HPZ.
• Total funds withheld is Rs. 56.49 Crore, equivalent to $6,935,554.10.

India Enforcement Directorate (ED), under the auspices of the Finance Ministry, froze the account balances of various Chinese-controlled entities in connection with a probe into app-based token HPZ.

The finance ministry announced the development in a press release yesterday, noting that the decision was due to several entities’ misuse of the token and other similar applications.

The withheld amount is Rs. 9.82 crore, equivalent to $1,206,529.39. The affected Chinese companies include Technology Private Limited of Wecash, Aliyeye Network, Magic Data, Baitu, Mobicred, Acepearl Services, Larting, and Comein Network.

The HPZ Token was an app-based token that promised customers significant returns on their investments under the pretext of “investing in and other cryptocurrency mining equipment,” the report said.

According to the press release:

The modus-operandi of the fraudsters was first to lure the victims into investing in their companies on the pretext of doubling/multiplying their investment through the “app HPZ Token” and other similar applications.

Previously, the ED had frozen virtual account balances amounting to Rs. 46.67 Crore, equivalent to $5,728,733.17, during the searches conducted on September 14. Consequently, the total amount under lock and key is Rs. 56.49 Crore or $6,935,554.10.

Additionally, the Indian Directorate of Enforcement initiated the money laundering investigation based on the first information report (FIR) dated October 8, under various sections of the Indian Penal Code, by Cyber Crime Police Station, Kohima, Nagaland.

Another report suggested that the fraudulent firms operated in agreement with different non-banking financial companies (NBFCs) and received funds from the public via apps such as Cashhome, Cashmart, and easyloan.

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