ED Exposes $90M Crypto Laundering Network
India’s Enforcement Directorate (ED) has uncovered a complex global money laundering operation linked to the trading platform OctaFX. Investigators revealed that the company laundered nearly ₹800 crore ($90 million) in illicit funds generated from fraudulent investment schemes targeting Indian citizens over just nine months.
OctaFX, incorporated in Cyprus and run by promoters in Russia, relied on a vast international network. Its technical support operated out of Georgia, management was based in Dubai, and servers were hosted in Barcelona. The firm used international payment gateways and cryptocurrency channels to disguise criminal proceeds, moving funds across borders and into digital assets.
Some of these transactions were routed through fake import invoices from Singapore to conceal their origins. Authorities seized assets worth $19 million, including a yacht, a villa in Spain, $4 million in bank accounts, 39,000 USDT in crypto, land holdings, and $9 million in stock market investments.
Shell Firms, Fake Invoices, and Crypto Channels
The ED’s investigation also revealed a broader web of illegal operations involving multiple platforms, including Power Bank, TM Traders, Vivan Li, and Zara FX. These entities used shell companies and forged documents to conduct fraudulent IPO allotments, fake stock investments, and even staged digital arrests to intimidate victims.
One key player, Birfa IT, acted as a broker by converting large sums of money into and out of cryptocurrency. It helped clients transfer funds to China for under-invoiced imports, sending $540 million to entities in Hong Kong and Canada under the guise of server leases and escrow services.
The funds were often layered through complex networks before being remitted overseas or cycled back into India disguised as legitimate stock market investments. In some cases, traditional hawala channels were used to bypass banking systems entirely.
Cyber Fraud Losses Surge in India
The OctaFX case comes amid a sharp rise in cyber financial crime in India. According to ED data, financial fraud losses jumped 206% in 2024, with over $2.56 billion lost in 3.64 million reported cases. This is a significant increase from $840 million in 2023 and highlights the growing sophistication of investment scams targeting Indian citizens.
Authorities say that many of these schemes are coordinated from abroad, particularly in Laos, Hong Kong, and Thailand, where fraud networks hire local agents to set up shell entities in India. These operations are often linked to large-scale scams involving cryptocurrencies, fake IPOs, and fraudulent online trading platforms.
The ED’s findings underline the evolving tactics used by criminal networks to exploit digital assets for cross-border laundering. With cryptocurrency playing a central role in these schemes, authorities are now tightening regulatory oversight and ramping up enforcement efforts to curb the misuse of digital finance.
