China\u2019s financial attack is something Indian authorities should be uneasy about.\u00a0 A strange security concern has occurred after an investigation by the Enforcement Directorate (ED) revealed some Chinese nationals have illegally floated multiple Indian companies, collecting thousands of crores in revenue and repatriating them to China, undetected by the Financial Intelligence Unit (FIU).<\/p>\n
ED seizes Rs 17 crore \u201cWith the help of chartered accountants, initially dummy Indian directors were used to incorporate the companies and after some time Chinese nationals travelled to India and took directorship in these companies,\u201d according to ED sources. The heightened concern has led to a crackdown on hundreds of Chinese-controlled mobile apps related to loans, dating, and betting operations in India.<\/p>\n
\u201cThe lax due diligence mechanisms of these payment gateways and their non-reporting of suspicious transactions to the regulatory authorities helped the accused to launch pan-India operations,\u201d the ED has said in one of its attachment orders. \u201cOnce bank accounts were opened, the internet access credentials were couriered by the Indian employees to China and major payment instructions came from the beneficial owners who were safely ensconced in China,\u201d it said.<\/p>\n
Network of 100+ Chinese loan apps busted, 22 held The probe has indicated that these Chinese nationals floated a large number of similar-looking websites which were hosted through Cloudfare, USA. \u201cThese websites attracted gullible persons to become members and use its services through various online apps,\u201d the ED said. Agents were hired to attract customers through special closed groups created through Telegram and WhatsApp.<\/p>\n
After freezing Rs 47 crore in HSBC Bank two years ago belonging to Chinese betting and dating apps for illegal money transfers to China, the ED shifted its focus on payment gateways, including Paytm, Cashfree, and Razorpay for not reporting these high-value transactions to the FIU. This led to the seizures of Rs 17 crore last week in these wallets, allegedly belonging to the owners of Chinese loan apps and related entities.<\/p>\n
These apps and their Indian lines were also involved in \u201cextortion and harassment of the public\u201d.<\/p>\n
Sources say that Uttar Pradesh cops unearth Rs 4,200 crore frauds linked to Chinese operators \u201cThere is a suspicion that apart from indulging in banned activities like online betting, this network of companies with their reliance on online wallets and their lax regulatory systems could have been used for hawala transactions as well,\u201d the ED said.<\/p>\n
It is coordinating with banks and regulatory authorities to further take action against these Indian payment gateways. Indians were hired for the purpose of opening bank and trade accounts and for threatening \u2018defaulters\u2019 of loans that were extended at a very high-interest rate.<\/p>\n
India must worry about the financial attack on India as well as fighting with its physical army at the Indian borders.<\/p>\n