Indian Gaming Platform WinZO's Founders Arrested in Bengaluru Over Alleged ₹43 Crore Money Laundering Scam
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The Enforcement Directorate (ED) has taken a major step in cracking down on alleged money laundering in the online gaming sector by arresting the founders of WinZO, a popular Indian gaming platform. Saumya Singh Rathore and Paavan Nanda, the co-founders, were arrested in Bengaluru on Wednesday after being questioned by the ED officials. According to officials, the duo was produced before a local court the same night and was sent to one-day custody. They are expected to be produced again before the court for further orders. The ED's move comes after an investigation found that WinZO allegedly held funds worth ₹43 crore from gamers after India banned real-money gaming. The agency claimed that these monies should have been refunded to players, but instead, were kept by the company. The ED had raided WinZO's premises and those of Gamezkraft, another online gaming company, last week under the Prevention of Money Laundering Act. The agency alleged that WinZO was operating real-money games from India, despite being banned in the country, and had generated illicit funds through the use of algorithms/software. WinZO had claimed to be fully compliant with all applicable laws and had emphasized its focus on protecting users and ensuring a secure experience. However, the ED's allegations suggest a different story. The agency claimed to have found that WinZO's global operations were undertaken through a single app hosted on the India-based platform. It also alleged that funds were diverted to the US and Singapore under the guise of overseas investments. The ED further claimed that funds worth USD 55 million were parked in a US-based shell company, which was operated from India. The ED's move is seen as a significant step in tackling the alleged money laundering in the online gaming sector in India. The agency has been cracking down on companies that allegedly engage in unscrupulous practices and money laundering activities.
