Payments solution provider Razorpay, which was raided by the Enforcement Directorate recently, in a statement said that it has cooperated with the agency and its funds have not been frozen. “This recent visit by the ED is part of the ongoing investigation against a few suspicious entities who conducted illegal business through multiple payment gateways/banks,” the company said in a statement on Friday.
“We proactively blocked all those suspicious entities and funds associated with them about 1.5 years ago, and have shared their details with the ED multiple times,” a Razorpay spokesperson said.
“All our operations and onboarding processes adhere to the highest standards of governance and regulatory guidelines. No funds of Razorpay were frozen,” the spokesperson said.
The fintech company stated that being a regulated financial institution it routinely cooperates with law enforcement agencies and provide necessary merchant information to assist in the investigation process.
The Enforcement Directorate had in mid-September said it has detected and frozen Rs. 46.67 crore kept in various bank accounts and virtual accounts of Razorpay, and three others — Easebuzz, Cashfree and Paytm — after raids in connection with a Chinese loan app case.
The agency had then said a total of Rs. 33.36 crore was found with Easebuzz Private Limited, Pune, Rs. 8.21 crore with Razorpay Software Private Limited, Bangalore, Rs. 1.28 crore with Cashfree Payments India Private Limited, Bangalore and Rs. 1.11 crore with Paytm Payments Services Limited, New Delhi.
The ED carried out search operations under the Prevention of Money Laundering Act (PMLA), 2002 at six business and residential premises in Delhi, Ghaziabad, Mumbai, Lucknow, Gaya and 16 other premises of banks and payment gateways branches and offices in Delhi, Gurgaon, Mumbai, Pune, Chennai, Hyderabad, Jaipur, Jodhpur and Bangalore in respect of an investigation related to the app-based token named HPZ and related entities.
The agency initiated a money laundering investigation on the basis of an FIR registered on October 8, 2021, filed under various sections of the Indian Penal Code (IPC) by Cyber Crime Police Station, Kohima, Nagaland.
The HPZ Token was an App-Based Token which promised users of significant gains against investment by investing in mining machines for Bitcoin and other cryptocurrencies, said the ED.
“The modus-operandi of the fraudsters was to first lure the victims to invest in the company on the pretext of doubling their investment through the app HPZ Token,” the agency had said then.