The Enforcement Directorate (ED), Mumbai Zonal Office, conducted search operations under the Prevention of Money Laundering Act (PMLA), 2002, at various locations in Mumbai, Chennai, Kolkata, and Delhi on April 18. The operations were carried out as part of an ongoing probe in the case of illegal online forex trading through the OctaFx trading platform, the ED informed on Saturday.
During the course of search operations, bank funds to the tune of ₹2.7 crore have been frozen and various incriminating documents, digital devices have been found and seized.
“The ED initiated investigation on the basis of a First Information Report registered by Shivaji Nagar Police Station, Pune, against several persons for their involvement in showing false temptations of high returns and duping persons in guise of forex trading through the OctaFx trading platform,” the ED official said.
The investigation revealed that the OctaFx online trading app and website are operating in India in association with India based entity M/s OctaFx India Private Limited. The OctaFx app and its website have not been authorised by the Reserve Bank of India (RBI) to deal in forex trading.
The ED officials said that this forex trading platform is widely promoted on social networking sites and is following referral-based incentive models for acquiring users to their platforms.
“It has emerged in the investigation that multiple accounts of different Indian banks were being shown to investors and users on OctaFx trading app/www.octafx.com for collecting funds in the guise of facilitating forex trading. The OctaFx also has manipulated trade activities and information shown on its platform ultimately resulting in net loss to the traders,” the officials informed.
The said accumulated funds, after defrauding these investors and users, were transferred to multiple e-wallet accounts or to bank accounts of dummy entities.
“This way, M/s OctaFx India Pvt. Ltd., M/s OctaFx, and their entities have cheated investors in the guise of forex trading thereby earning a profit of more than ₹500 Crore from Indian region,” the ED official added.
A portion of these funds were layered through a web of complex transactions with the help of shell entities and remitted abroad to its related entities in the garb of bogus freight services, import of services, etc.
On the basis of investigation conducted and PoC identified so far, assets to the tune of ₹35 crore in form of crypto currencies, bank balances, gold coins etc. were attached by the ED. The search operations unveiled a network of chartered accountants and professionals, who gave fake certificates of remittances and facilitated bank accounts/companies for layering of such funds.
It has also been revealed that the entire process of reflecting account numbers of dummy entities, managing the funds collected in these accounts and diversion of the same are being managed and operated by owner of OctaFx group entities based in Spain, Russia, Georgia, and Dubai.
“M/s OctaFx has also hired several Indian individuals working in Spain and Russia for operating the OctaFx trading platform and inducing Indian citizens to invest in forex trading through OctaFx. We are still investigating the matter,” the ED officials said.
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