WazirX Exchange Suspected of Money Laundering
WazirX exchange suspected of money laundering
WazirX exchange and its management are under investigation on suspicion of violating currency rules, the Indian Finance Ministry’s Enforcement Administration (ED) said.
Indian cryptocurrency exchange WazirX has become a defendant in an investigation by the Indian Enforcement Administration (ED). The site is being screened for violations of the Indian Foreign Exchange Act (FEMA). The agency reportedly found suspicious transactions while checking illegal online betting apps owned by Chinese citizens for money laundering.
During the investigation, the department found out that laundered criminal proceeds worth about 570 million rupees (~ $ 8.8 million) were converted into cryptocurrency using the Binance platform.
Pursuant to the Foreign Exchange Management Act (FEMA) of 1999, ED asked WazirX for an explanation of the reasons for transactions totaling Rs 27.91 billion (~ $ 382 million).
According to the FDA’s cited media notice, Chinese citizens laundered income by converting rupee deposits into USDT, then transferring the cryptocurrency into their wallets on Binance “based on instructions received from overseas.”
According to ED, during the period under investigation, WazirX received cryptocurrency worth 8.8 billion rupees (~ $ 120 million) from Binance accounts and transferred back digital assets worth 14 billion rupees (~ $ 191 million).
“WazirX does not collect the required documents, which is a clear violation of the core mandatory anti-money laundering (AML) and counter-terrorist financing (CFT) regulations and FEMA guidelines,” the agency said in a statement.
WazirX director Nishal Shetty commented on the investigation against the crypto exchange on Twitter. He wrote that the site complies with the requirements for customer identification (KYC) and anti-money laundering (AML). WazirX always provides information to law enforcement, Shetty added.
Recall, according to media reports, the US authorities are conducting an audit against Binance for violations in the field of anti-money laundering and fiscal laws.
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