ED attaches ₹19.39 crore in assets linked to operators of instant-loan apps
ED has provisionally attached ₹ 19.39 crore in bank balances and fixed deposits belonging to various entities connected with certain instant-loan apps. File
| Photo Credit: PTI
The Enforcement Directorate has provisionally attached ₹ 19.39 crore in bank balances, and fixed deposits belonging to various entities connected with certain instant-loan apps.
The agency is conducting a probe under the Prevention of Money Laundering Act which is based on 118 First Information Reports registered by the Telangana police against 242 instant loan mobile applications. It is alleged, that certain fintech companies were running numerous loan apps charging steep processing fees, exorbitant interest rates and penalties from borrowers.
The loan apps were being used for non-banking finance business without valid licences from the Reserve Bank of India or were utilising licences of defunct, dormant, non-functional companies.
“While sanctioning the loans, contact details, photos and personal data were being accepted through the loan apps. This data was then misused through tele-caller companies to recover outstanding loan amounts by abusing borrowers and their families and also by sending objectionable images of borrowers to their contacts with derogatory remarks. The borrowers were urged to take other loans from related loan applications to repay existing loans creating a debt trap situation,” said the agency.
Chinese directors
The ED investigation revealed that certain mobile apps — such as “Online Loan”, “Rupiya Bus”, “Flip Cash”, “Rupee Smart”, etc. were linked to Nimisha Finance India Private Limited and Skyline Innovation Technology (India) Private Limited, a fintech company with Chinese directors, and the alleged proceeds of crime were generated via lending business through these mobile apps.
According to the agency, Skyline had an agreement with Rajkot Investment Trust Limited (RITL) for the same purpose and in the process, transferred alleged proceeds of crime totalling ₹ 20 crore to it. However, following the arrest of Skyline directors and initiation of criminal proceedings, the funds were not used by RITL. Instead, the company retained the amount and transferred it the accounts of various related persons and entities.
“A part of the proceeds of crime was also withdrawn in cash to obfuscate the trail of funds. The money trail led to the attachment of these POC (proceeds of crime) totalling ₹ 19.39 crore in bank accounts and fixed deposits belonging to Nimisha Finance India Private Limited, Rajkot Investments Trust Limited, Mahananda Investment Limited, Baskin Management Consultancy Private Limited and others,” said the ED.
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