According to the ED, its investigation revealed that Chinese nationals were operating the app with the help and support from Indian nationals. “The funds mobilised from the gullible online gamers through the Fiewin app were deposited into the bank accounts of various persons [called recharge persons] who had allowed the use of their accounts by the app owners in lieu of certain commissions,” said the agency, adding that about Rs 400 crore was raised through the alleged fraud.
How the Scam Worked:
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Attractive Promise: Fiewin lured users with the promise of easy earnings through mini-games. -
Fund Trapping: Once users had accumulated funds, the app prevented withdrawals, trapping their money. -
Money Laundering: The stolen funds were laundered using digital wallets linked to a global cryptocurrency exchange.
Local police across India began receiving reports from victims who lost funds to the Fiewin app. Due to the growing number of victims reporting the scams, the case was escalated to the Enforcement Directorate (ED), a key law enforcement agency that specializes in combating financial crime.
Through its investigation, the ED discovered that the app had been part of a cross-border criminal network it used various methods to obfuscate the origin and movement of illicit funds by utilizing bank accounts of “mules” and cryptocurrency wallets, creating a complex web of transactions to hinder detection and tracing.
In partnership with Binance, the ED launched a comprehensive investigation and traced the flow of laundered money across various cryptocurrency wallets.
Key Figures Arrested: The ED has arrested four individuals involved in facilitating the fraud.
Criminal Network: The investigation is ongoing, with authorities working to dismantle the broader criminal network behind the scam.
Prevention of Future Scams: The ED and Binance are committed to ensuring justice is served and preventing similar scams in the future.
ED and Binance have also successfully partnered to dismantle the E-Nugget scam, a fraudulent digital investment scheme disguised as a gaming platform. This joint operation led to the identification and freezing of 42 digital-asset accounts and hundreds of bank accounts, totaling nearly $6 million in ill-gotten gains, through meticulous blockchain analysis and vital ground operations.
This case highlights the importance of public-private partnerships in combating financial crime and protecting consumers from online scams
First Published: Sep 25 2024 | 2:02 PM IST
