India's Directorate of Enforcement freezes $1.5 million in bitcoin linked to money laundering

Quick Take

  • India’s Directorate of Enforcement has frozen 77.6 bitcoins — worth around $1.5 million — linked to E-nuggets.
  • The assets were transferred from WazirX to Binance.
  • The agency also seized 173 million rupees.

India's Directorate of Enforcement (ED), a law enforcement agency that investigates financial crimes, has frozen cryptocurrencies worth 128 million rupees ($1.5 million).

ED froze 77.6 bitcoins under the Prevention of Money Laundering Act (PMLA) as part of an ongoing investigation into Aamir Khan and others linked to gaming app E-nuggets. The frozen bitcoins were initially purchased on WazirX before being transferred to Binance — where the assets have been frozen.

Led by the Park Street police in Kolkata, the investigation has been ongoing since February 15, 2021, according to the announcement — which also notes that Aamir Khan and his partner, Nesar Ahmed Khan, launched E-nuggets in an attempt to defraud users. "After collecting a seizable amount of money from the public, all of a sudden withdrawal from the said app was stopped on one pretext or the other," it reads, continuing, "Thereafter, all data including profile information was wiped from the said app servers."

In the course of its investigation, ED discovered the accused had been transferring the funds overseas using crypto exchanges. Using the name Sima Naskar, an account was opened at WazirX — which saw its bank balances frozen in August by the ED — and was used to purchase cryptocurrencies that were transferred to Binance. ED's notice said the crypto relating to these transfers and held on Binance has now been frozen.

Aamir Khan previously had 173.2 million rupees (approx. $2.1 million) in cash seized from his property during a search. 

After the publication of this story, WazirX told The Block: "WazirX that it has been cooperating with the ED by giving them all the pertinent facts, information, and documents that the investigators were looking for."

A Binance spokesperson confirmed the exchange froze the funds at the request of the Enforcement Directorate, following the publication of this story. "It’s our position to cooperate fully and collaboratively with all legally valid requests and inquiries," they said. 

Binance had not responded to a request for comment as of the time of publishing.

Editor's Note: Updated with comment from WazirX and Binance.

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