ED files chargesheet against Razorpay, fintech companies and NBFCs in Chinese loan app case
According to a statement by the federal probe agency, a special court in Bengaluru has acknowledged the chargesheet filed by the Enforcement Directorate (ED) in connection with the Chinese loan app case. The ED has filed a prosecution complaint against five individuals and seven entities, including payment gateway Razorpay, and the special PMLA court in Bengaluru has taken cognizance of the complaint, as per a press statement released by the agency on Friday.
According to the Enforcement Directorate (ED), seven entities and five individuals, including payment gateway Razorpay, have been named as accused in the Chinese loan app case. The accused entities consist of three fintech firms, namely Mad Elephant Network Technology Private Limited, Baryonyx Technology Private Limited, and Cloud Atlas Future Technology Private Limited, which are controlled by Chinese nationals. In addition, three non-banking financial firms registered with the Reserve Bank of India, X10 Financial Services Private Limited, Track Fin-ed Private Limited, and Jamnadas Morarjee Finance Private Limited, have been included in the chargesheet.
Earlier, the Enforcement Directorate (ED) attached Rs 77.25 crore lying in bank accounts and payment gateways with two provisional attachment orders. The central agency initiated an investigation based on various FIRs filed by the CID, Bengaluru, on complaints from customers who had availed loans and faced harassment from the recovery agents of these moneylending firms. The ED’s investigation revealed that fintech companies had agreements with NBFCs for loan disbursement through digital lending apps.
The probe showed that “these fintech companies are illegally running the money lending business, and these NBFCs knowingly let these fintech companies use their names to get a commission without being careful about their conduct, violating the RBI’s Fair Practices Code.” The ED stated that further investigation in the case is ongoing.
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