The investigation revealed that the funds collected from gaming were deposited into the accounts of individuals referred to as “recharge persons.” These individuals permitted their accounts to be used in exchange for a commission from the app owners. According to the ED, the total amount was subsequently converted to cryptocurrency and transferred to the crypto accounts of Chinese nationals.
“Through its investigation, the ED discovered that the app had been part of a cross-border criminal network that used various methods to obfuscate the origin and movement of illicit funds by utilizing bank accounts of ‘mules’ and cryptocurrency wallets, creating a complex web of transactions to hinder detection and tracing,” Binance said.
Who has been arrested?
- Arun Sahu and Alok Sahu, from Odisha’s Rourkela, acted as “recharge persons,” collecting money from online gamers and depositing it into their accounts. This money was then converted to cryptocurrency and transferred to online wallets belonging to Chinese nationals.
- Chetan Prakash, an engineer from Patna, was arrested for his role in converting funds from the recharge persons’ accounts into cryptocurrency.
- Joseph Stalin, a software engineer from Chennai, was also arrested. He allegedly assisted Pie Pengyun, a Chinese national from Gansu province, in becoming a co-director of his company.
- The ED found that Pengyun utilised Stalin’s company, Studio 21, for bulk payouts related to the Fiewin app, which initially built trust with online gamers, encouraging them to place larger bets.
- The investigation has led to multiple arrests of individuals facilitating the fraud, who communicated using privacy-focused messaging apps and operated from various locations.
- So far, approximately Rs 400 crore has been laundered through the Fiewin app, deposited as cryptocurrency into eight Binance wallets owned by Chinese nationals. These Chinese nationals communicated with the Indian accused via the Telegram platform.