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ED Investigating Fraudulent Cryptocurrency and Digital Currency Cases: MoS Finance The ED is investigating the matter under the provisions of the Prevention of Money Laundering Act, 2002 (PMLA) and Foreign Exchange Management Act, 1999 (FEMA).

By Paromita Gupta

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On Monday, the Minister of State for Finance, Pankaj Chaudhary, informed the Parliament of the Enforcement Directorate, investigating several cases of cryptocurrency and virtual digital currency where a handful of cryptocurrency exchanges have been found involved in money laundering.

Responding to question no 5127 on "(a) whether the crypto related frauds have increased in last few years and if so, the details thereof including the number of such frauds reported with the Government during each of the last five years; (b) the steps taken by the Government to prevent such frauds; (c) whether all crypto exchanges operating in the country are in compliance with international financial regulations; and (d) if so, the details thereof and if not, the reasons therefor?," the MoS Finance addressed the parliament in session.

"(a) to (d): Crypto assets are currently unregulated in India. Frauds relating to crypto are dealt with under extant laws against fraud and cyber crime. The Ministry of Home Affairs has a portal at http://cybercrime.gov.in where frauds involving crypto assets can be reported to the Cyber & Information Security Division. Further, 'Police' and 'Public Order' are State subject as per the Seventh Schedule of the constitution of India. States/UTs are primarily responsible for the prevention, detection, investigation and prosecution of such crimes including financial frauds through their law Enforcement Agencies. The 'Citizen Financial Cyber Reporting and Management System' has been launched for immediate reporting of financial frauds and to stop siphoning of funds by the fraudsters. A toll-free Helpline number '1930' has been operationalized to get assistance in lodging online cyber complaints."

The ED is investigating the matter under the provisions of the Prevention of Money Laundering Act, 2002 (PMLA) and Foreign Exchange Management Act, 1999 (FEMA). The crime volume adds up to INR 953.70 crores as of April 3rd, 2023, with five individuals being arrested and six Prosecution Complaints being filed before the Special Court. Under FEMA, assets worth INR 289.28 crores have been seized under section 37A of FEMA with one Show Cause Notice issued to crypto asset exchange Zanmai Labs Private Limited, known as WazirX and its Directors for assets worth INR 2790.74 crores.

Paromita Gupta

Features Writer with Entrepreneur India

Covering news and trends in AI and Metaverse segments. An avid book reader running her personal blog on the side. You may reach me at paromita@entrepreneurindia.com. 
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