Indian authorities have unleashed a major financial strike, freezing crypto assets worth thousands of crores linked to illegal forex and crypto trades, as the dragnet tightens on global networks funneling funds through shell firms and offshore channels.
India Freezes $271M in Crypto Amid Crackdown on Illegal Forex Trading
India’s financial authorities have taken fresh action against cross-border trading misconduct linked to digital assets and forex activity. The Directorate of Enforcement (ED), Mumbai Zonal Office, announced on Oct. 17 that it had attached cryptocurrency holdings valued at about Rs. 2,385 crore ($271 million) under the Prevention of Money Laundering Act (PMLA), 2002. The move follows the arrest of Pavel Prozorov in Spain, identified as the key figure behind operations connected to OctaFX, an unlicensed online forex trading platform under investigation for financial irregularities.
In a statement, the agency said: “ED initiated PMLA investigation on the basis of FIR registered by Shivaji Nagar PS, Pune, Maharashtra against several individuals for defrauding investors by falsely promising high returns through the OctaFX forex trading platform.” Findings indicated that OctaFX drew approximately Rs. 1,875 crore from Indian investors between July 2022 and April 2023, generating an estimated Rs. 800 crore in profits. The ED added:
OctaFX presented itself as an online forex trading platform for currency, commodities, and crypto trading without RBI permission. The initial investors received small profits to build trust, as is generally seen in a typical Ponzi scheme.
The agency reported that OctaFX transferred over Rs. 5,000 crore abroad through layered networks and offshore entities.
Investigators said the platform used domestic UPI and bank transfers routed through shell entities and unauthorized payment aggregators, disguising the money as software and R&D payments to overseas firms. Some funds later returned to India as foreign direct investment. Authorities have now attached Rs. 2,681 crore in assets, including 19 properties and a luxury yacht in Spain. A prosecution complaint and a supplementary filing have been submitted to the Special Court under PMLA. Market observers say that while the case underscores weak oversight in unlicensed trading platforms, it also reinforces the importance of clearer regulation for legitimate forex and crypto operations.
FAQ 🧭
- What is the total value of crypto assets attached by Indian authorities in this case? The Directorate of Enforcement has attached cryptocurrency worth approximately Rs. 2,385 crore under the PMLA.
- Who is Pavel Prozorov and what is his role in the OctaFX probe? He is the alleged mastermind behind the OctaFX platform and was arrested in Spain for financial crimes tied to unlicensed forex and crypto trading.
- How were investors defrauded by OctaFX? OctaFX lured investors with false high-return promises, manipulated trades, and ran operations resembling a Ponzi scheme without RBI authorization.
- What does this crackdown signal for the future of crypto and forex trading in India? It highlights the urgent need for tighter regulation while opening the door for compliant platforms to operate transparently and legally.
Author: Kevin Helms
Source: Bitcoin
Reviewed By: Editorial Team
