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Funds Frozen By Enforcement Directorate Do Not Belong To Paytm: One 97 Communications

On Friday, the government agency conducted raids in six locations of online payment companies Razorpay, Paytm, and Cashfree in Bengaluru, as part of an ongoing investigation regarding the illegal instant smartphone-based loans 'controlled' by Chinese persons

Funds Frozen By Enforcement Directorate Do Not Belong To Paytm: One 97 Communications
POSTED ON September 05, 2022 4:07 PM

One 97 Communications, the parent company of Paytm has said in an exchange filing on Sunday that the funds that are being frozen by the Enforcement Directorate as part of the ongoing investigation regarding the Chinese loan apps, don’t belong to Paytm or any of its group entities. 

 “As a part of ongoing investigations on a specific set of merchants, the ED has sought information regarding such merchants to whom we provide payment processing solutions. It is hereby clarified that these merchants are independent entities, and none of them are our group entities. We are and will continue to, fully cooperate with the authorities, and all the directive actions are being duly complied with,” the statement by One 97 Communications said. 

“It may be noted that ED has instructed us to freeze certain amounts from the Merchant IDs (MIDs) of a specific set of merchant entities (as mentioned by the ED in their press release). It may be further noted that none of the funds which have been instructed to be frozen belong to Paytm or any of our group companies,” it added. 

On Friday, the government agency conducted raids in six locations of online payment companies Razorpay, Paytm, and Cashfree in Bengaluru, as part of an ongoing investigation regarding the illegal instant smartphone-based loans “controlled” by Chinese persons.

According to a report by PTI, the ED has seized funds worth Rs 17 crore, “merchant IDs and bank accounts of these Chinese persons-controlled entities", during the raids. As per the report, “The modus operandi of these entities is that they use forged documents of Indians and make them dummy directors leading to the generation of proceeds of crime. These entities are controlled/operated by Chinese persons.”

The development comes amidst heightened scrutiny of Chinese mobile manufacturers Vivo, Oppo, and Xiaomi, alleging these entities of money laundering. 
 

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