New Delhi September 3 2022: India’s anti-money laundering agency said it was searching the premises of online payment companies including Razorpay Pvt Ltd, Cashfree Payments and Paytm Payment Services Ltd.
The search operations, conducted in the tech hub Bengaluru yesterday, were a part of a probe involving a Chinese loan app case where there were allegations of extortion and harassment of customers, according to an e-mailed statement from the investigation agency. “During inquiries, it has emerged that these entities are controlled/operated by Chinese persons,” it said.
They forged documents of Indians, making them “dummy directors” of the companies that were generating proceeds of crime through merchant accounts held with payment gateways and banks, the investigating agency said, adding it has seized INR17 crore ($2.1 million).
The latest move underlines heightened scrutiny of Chinese companies, following a Himalayan border clash between the two nuclear-armed neighbors in 2020 that left 20 Indian and four Chinese soldiers dead.
Razorpay said some of its merchants were investigated by law enforcement about a year and a half ago.
“As part of the ongoing investigation, the authorities requested additional information to help with the investigation,” the company said. “We have fully cooperated and shared KYC and other details. The authorities were satisfied by our due diligence process.”
A Paytm spokesperson said they are cooperating with authorities, who are investigating a specific set of merchants. “The authorities reached out to us with directions to provide certain information about these merchants under scrutiny, to which we promptly responded.”