CoinSwitch offices are being investigated by India’s ED
Another cryptocurrency company in India is now the target of an investigation by India’s financial crimes unit.
According to recent reports, India’s Enforcement Directorate (ED) has leveled allegations of illegal forex activity against one of India’s top cryptocurrency exchanges, CoinSwitch Kuber. Additionally, on Thursday, the agency conducted investigations at five other CoinSwitch locations.
Reuters was told by a representative who did not wish to be identified that the financial watchdogs had seized bank documents, collected information regarding overseas trading, and assessed its compliance standards, all on the basis of alleged irregularities involving foreign exchange.
The CEO of the exchange, Ashish Singhal, stated that this was not a raid and “not about money laundering.” Rather, it was an investigation into how the exchange operated, how it implemented its Know Your Customer (KYC) regulations, and how it onboarded new users.
According to statements made by Singhal to Reuters,
“the majority of their involvement with us has been about knowing what CoinSwitch performs.” He continued by saying that the ED “has been engaged with us with respect to [the] running of our cryptocurrency platform, and we are fully working with them.”
There have been numerous rumors in the media circulating about the recent engagement that took place between @CoinSwitchKuber and ED Bangalore. So allow me to set the record straight.
There are many media reports doing the rounds about the recent engagement of ED Bangalore with @CoinSwitchKuber. So let me clear the air.
• First of all, the last few days’ events are not about money laundering or PMLA.
Here’s what is happening:
— Ashish Singhal (@ashish343) August 27, 2022
During the month of July, Singhal gave an interview to the Indian journal Business Standard, in which he stated that the company makes sure “that crypto transactions are in the KYC framework.”
The investment giant Andreessen Horowitz spearheaded a funding round that resulted in CoinSwitch being classified as a unicorn in the previous year. In addition to other investors, Sequoia Capital India and Coinbase Ventures have provided financial support for CoinSwitch.
Following the Indian exchanges will be ED
This is not the first time that India’s financial watchdog has taken a hard stance against the cryptocurrency business in the country.
It was reported on the 11th of August that the ED went after WazirX, which is another cryptocurrency exchange. According to the Economic Times, the agency said that WazirX had illegally transferred more than 130 million dollars to international exchanges.
The agency made the announcement a day later that it had frozen the assets of the Singapore-based cryptocurrency exchange Vauld owing to allegations of predatory lending practices. The assets were valued at $46.4 million.
Along with these levies, the country had recently enacted a tax of 30% on income made from cryptocurrencies. Because of the steep fee, trading activity has significantly decreased on a number of exchanges, including WazirX, ZebPay, and CoinDCX.
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