India’s Enforcement Directorate (ED) has uncovered a transcontinental money laundering operation centered on the illegal trading platform OctaFX.
Summary
- ED uncovers $90m crypto-linked laundering by OctaFX
- Cyber fraud losses for Indians soared 206% in 2024, topping $2.56B in scams
- Shell firms, fake imports, and hawala used to move crime funds into crypto
ED seizes $19m in assets across multiple jurisdictions
The platform allegedly generated ₹800 crore ($90 million) in criminal proceeds from its Indian operations in just nine months.
OctaFX, incorporated in Cyprus—with promoters based in Russia, technical support in Georgia, operations managed from Dubai, and servers in Barcelona—became part of an ED investigation into networks converting the proceeds of crime into cryptocurrencies.
The multi-agency probe revealed that OctaFX, which deals in forex, commodities, and cryptocurrencies, used international payment gateways and crypto channels to launder funds generated from investment fraud schemes targeting Indian citizens.
Some transactions were layered through the fake import of services from Singapore to conceal the origin of illicit funds.
According to the Times of India, the ED has attached $19 million worth of assets in India and abroad. These include a yacht, a villa in Spain, $4 million in bank accounts, 39,000 USDT in crypto holdings, land, and stock market investments worth $9 million.
OctaFX is not the only illegal platform under ED investigation. Other platforms include Power Bank (investigated by the Bengaluru zonal unit), Angel One, TM Traders, and Vivan Li (investigated by Kolkata), and Zara FX (investigated by Kochi).
The ED’s cases are based on FIRs registered by police across various Indian cities.
The probe found that cyber frauds involved firms like Birfa IT acting as brokers, converting large amounts of money to and from cryptocurrency to help clients send funds to China for under-invoiced imports.
In the Birfa case, remittances totaling $540 million were sent to Hong Kong and Canadian entities controlled by scammers, under the pretext of leasing servers and escrow services using fake invoices.
An ED report estimated that Indians lost more than $2.56 billion in approximately 3.64 million financial fraud cases reported in 2024.
Financial fraud losses surge
This marks a 206% increase in losses from $840 million in 2023 and over a 50% rise in reported cases from 2.44 million that year.
Investigations into similar cyber investment frauds found that masterminds operating from Laos, Hong Kong, and Thailand hired agents in India to set up shell entities using forged documents.
These operations issued fake IPO allotments and stock market investments while carrying out fake digital arrests to intimidate victims.
Criminal proceeds were funneled through shell companies, converted into cryptocurrencies, and remitted overseas as payments for fake imported services.
While international payment gateways facilitated many of these illegal transactions, a portion of the funds was also laundered through hawala channels. Some proceeds were brought back to India, disguised as legitimate investments in the stock market.
