On Saturday, India’s federal financial crime-fighting agency said it was searching the offices of online payment companies as part of an investigation into Chinese-controlled firms and individuals suspected of engaging in illegal lending practices.
According to the Enforcement Directorate, the payment companies included Razorpay Pvt Ltd, Cashfree Payments, and Paytm Payment Services Ltd.
“The search operation includes the premises of Razorpay Pvt Ltd, Cashfree Payments, Paytm Payment Services Ltd, and entities controlled or operated by Chinese persons,” it said.
The searches are part of an investigation into a Chinese loan app where there have been allegations of extortion and harassment of customers who have taken out small loans, according to the report.
According to the Directorate, Chinese-controlled entities are suspected of criminal activity, and the individuals are accused of forging documents of Indian citizens in order to make them directors of companies generating criminal proceeds.
The agency seized 170 million Indian rupees ($2.13 million) in merchant IDs and bank accounts owned by Chinese individuals.
The Directorate did not identify the companies or individuals from whom the funds were seized.
The transactions were carried out through various merchant accounts with payment gateways and banks, according to the statement.
One 97 Communications Ltd is Paytm’s parent company.
The searches were taking place in Bengaluru, India’s tech capital.
“A year and a half ago, law enforcement was looking into some of our merchants. Authorities have requested additional information to assist with the ongoing investigation as part of the ongoing investigation “Reuters was given a statement from a Razorpay spokesperson.
Razorpay stated that it has shared additional information with authorities.
Paytm and Cashfree did not respond immediately to Reuters’ requests for comment.
