The Enforcement Directorate (ED) filed a prosecution complaint against seven entities and five individuals in the Chinese Loan App case before the Special PMLA Court in Bengaluru.
The accused entities include three Fintech companies - Mad Elephant Network Technology Private Limited, Baryonyx Technology Private Limited and Cloud Atlas Future Technology Private Limited, which are controlled by Chinese nationals, three NBFCs registered with the RBI - X10 Financial Services Private Limited, Track Fin-ed Private Limited and Jamnadas Morarjee Finance Private Limited, and one payment gateway - Razorpay Software Private Limited.
Earlier, the ED issued two provisional attachment orders and attached Rs 77.25 crore in bank accounts and payment gateways.
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The ED began its investigation after FIRs were registered by the Bengaluru CID based on the complaints received from various customers who had availed loans and faced harassment from the recovery agent of these money lending companies.
The investigation revealed that the Fintech companies have an agreement with the respective NBFCs for the disbursement of loans through digital lending apps.
It was also found that the money lending business was being illegally run by these Fintech companies and that the NBFCs knowingly let the fintech companies use their names for commission without conducting any checks on the fintech firms in violation of the Fair Practices Code of the RBI.
Further investigation is underway.
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