The Enforcement Directorate searched locations in Bengaluru and Madhya Pradesh on Thursday regarding unauthorised crypto transfers of Rs 5,000 crore. The agency said RPFAS Technologies used Mudrex and Saber.money to bypass FEMA rules. The probe showed the firm used shell entities and illegal foreign payouts to move money across borders.
The Enforcement Directorate (ED) in Bengaluru searched three locations in Bengaluru and Madhya Pradesh with regards to unauthorised cross-border financial transactions of over Rs 5,000 crore via cryptocurrency, according to an 'X' post from the organisation on Thursday. The authorities stated that their investigation uncovered the use of shell organisations in tax haven nations, notable over-the- counter deals and use of illegal foreign payments through platforms like Binance and Bybit.
"The probe exposed use of shell entities in tax haven countries, massive over-the counter (OTC) deals and illegal foreign payouts via platforms like Binance and Bybit in violation of FEMA provisions," the post said.
The ED alleged that RPFAS Technologies PVT. was operating platforms named 'Mudrex' and 'Saber Money', used to carry out unauthorised cross-border transactions and crypto trading. According to the enforcement agency, these platforms were using crypto tokens, mainly, stablecoins such as USDT and USDC to undertake these aforementioned illegal transactions. These actions, which the ED used discreet enquiries and intelligence gathering to uncover, were found to be in circumvention of Foreign Exchange Management Act, 1999 (FEMA) regulations.
The firm was also advertising the ability to transfer cash across borders via cryptocurrency despite not being authorised by the Reserve Bank of India to do so, the ED's press release alleged. The economic intelligence agency further claimed that the firm was openly advertising services to purchase, offload and exchange or convert fiat to crypto and vice versa instantaneously along with global transfer of money.
"The entity openly advertises on the internet web pages offering services i.e. buying, selling and swapping/converting of crypto immediately / the fastest way to convert fiat to crypto and back for global transfer of money," the release said.
The ED also alleged that the company offers on-ramp and off-ramp services of crypto currencies through Virtual Assets enabling cross border transfer of money and also converts fiat into Crypto which is delivered cross border.
"On-ramp is a service that allows users to convert traditional "fiat" money (like INR, USD, EUR etc.) into virtual digital assets like Bitcoin or stablecoins (USDT) etc. An Off-ramp is a service to sell virtual digital assets and withdraw the cash back into bank accounts," the release said.