Rs 400 crore fraud revealed, Indian authorities link gaming app to Chinese nationals
PTC News Desk: An investigation into the online gaming application Fiewin has unveiled a significant Rs 400-crore fraud involving Chinese nationals. The Enforcement Directorate (ED) has taken swift action by freezing the accounts of several individuals connected to Fiewin, amounting to approximately Rs 25 crore.
In an earlier crackdown, four Indian individuals suspected of aiding these Chinese nationals in the fraudulent scheme were arrested in Kolkata. This investigation has been supported by Binance, the world’s largest cryptocurrency exchange.
The Fiewin app attracted users by offering a simple way to earn money through mini-games. According to a statement from Binance, new users could effortlessly create accounts and participate in games, with the option to 'top up' their in-app balance using various payment methods.
However, once users accumulated substantial funds, they discovered that the app no longer allowed them to withdraw their money, effectively locking them out of their earnings.
The ED's investigation revealed that approximately Rs 400 crore was siphoned off through this scheme, with funds being transferred to multiple cryptocurrency addresses later traced back to the operation. The number of complaints about Fiewin grew, prompting local police to escalate the case to the ED, which specialises in economic crimes and money laundering.
The probe found that the money collected from users was funneled into accounts managed by individuals referred to as 'recharge persons.' These individuals allowed their accounts to be used in exchange for a commission from the app's operators. The money would then be converted into cryptocurrency and transferred to the accounts of Chinese nationals.
Binance noted that the app was part of a cross-border criminal network that utilized various methods to conceal the origin and movement of illicit funds, employing "mule" bank accounts and cryptocurrency wallets to create a complex web of transactions that hindered detection.
The ED's investigation identified Arun Sahu and Alok Sahu from Rourkela, Odisha, as "recharge persons." They were responsible for receiving funds from online gamers, which were subsequently converted into cryptocurrency and sent to Chinese nationals’ online wallets.
Chetan Prakash, an engineer from Patna, was also arrested and is believed to have played a crucial role in converting funds from the recharge persons' accounts into cryptocurrency.
Additionally, Joseph Stalin, a software engineer from Chennai, was arrested for assisting Pie Pengyun, a Chinese national from Gansu province, in becoming a co-director of Stalin's company. The ED discovered that Pengyun used Stalin’s company, Studio 21, for bulk payout services related to the Fiewin app, which initially helped gain the trust of online gamers, encouraging them to place larger bets.
The investigation has resulted in multiple arrests of individuals who facilitated the fraud while coordinating with handlers linked to Fiewin. The criminals communicated through privacy-focused messaging applications and operated from various locations.
So far, the investigation has determined that nearly Rs 400 crore has been laundered using the Fiewin app. This money was deposited as cryptocurrency in eight Binance wallets belonging to Chinese nationals. These individuals communicated with the Indian accused—Arun Sahu, Alok Sahu, Chetan Prakash, and Joseph Stalin—using the Telegram platform.
As the case continues to unfold, both the ED and Binance are working closely to dismantle the criminal network behind this fraud scheme. Their collaborative efforts aim to uncover the full extent of Fiewin's fraudulent activities and identify all individuals involved.
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- With inputs from agencies
