Nagaland Money Laundering Case: ED Files Complaint Against 299 People, 76 Chinese Entities

KOHIMA: The Enforcement Directorate (ED) has lodged a legal complaint with a special court under the Prevention of Money Laundering Act, 2002 (PMLA) in Dimapur, Nagaland.

The complaint names 299 accused persons and 76 entities controlled by Chinese interests with 10 Chinese-origin directors, along with two other foreign entities.

The special court acknowledged the money laundering offense described in the prosecution complaint on March 5, 2024. This decision was based on the finding that a prima facie case had been established under the Prevention of Money Laundering Act (PMLA) against the 299 accused individuals and entities.

The ED initiated an investigation based on the FIR filed by the Cyber Crime Police station in Kohima.

The FIR was filed under several sections of the Indian Penal Code, 1860, and the Information Technology Act.

The investigation is related to the scam involving deceiving investors with promises of high returns on investments, purportedly for mining bitcoins and other cryptocurrencies. The perpetrators allegedly used an app-based token called "HPZ Token" for this scheme.

The ED investigation found that several bank accounts and merchant IDs were opened by shell entities. These entities had dummy directors or proprietors and were used solely to rotate or layer the proceeds of crime. These funds were fraudulently obtained through illegal online gaming and betting, as well as investments in Bitcoin mining.

Investors were promised returns of Rs. 4,000 per day for three months on an investment of Rs. 57,000. However, after paying out once, the scheme operators requested additional funds rather than continuing the promised returns.

Previously, the ED had conducted search operations at 44 locations across the country, resulting in the freezing of Rs. 176.67 Crore held by shell entities in various banks and virtual accounts.

Additionally, movable and immovable properties worth Rs. 278.70 Crore, held in the name of dummy entities, were attached. The total seizure and attachment amount to Rs. 455.37 Crore.

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