Indian Agency Teams Up with Binance to Halt Scam App
The Enforcement Directorate confiscated 90 crores ($10.5 million) from the online scam app E-Nuggets with assistance from exchanges like Binance, ZebPay, and WazirX.
Authorities successfully traced funds linked to the E-Nugget scam app to various cryptocurrency exchanges. They partnered with these exchanges to seize over $10.5 million in crypto assets.
The Enforcement Directorate (ED), an Indian law enforcement agency, confiscated 90 crores ($10.5 million) from the online scam app E-Nuggets with assistance from exchanges like Binance, ZebPay, and WazirX.
According to The Hindu, the E-Nugget gaming app held around $10 million in 70 crypto wallet accounts spread across three crypto exchanges. The ED worked with these exchanges to block the wallet addresses and move the crypto assets to the agency’s account.
ED, Kolkata led a successful operation against a major “online gaming app scam” known as “E-Nugget”. The E-Nugget app, masqueraded as a gaming platform, promised users high returns on their investments. Crypto assets which were taken into possession of ED are transferred into… — ED (@dir_ed) April 30, 2024
The ED's report claimed that the E-Nugget app lured customers with promises of high investment returns under the guise of a gaming platform.
The app presented enticing investment options through various engaging games, offering large commissions for users to bet on. However, once funds were invested, the app went offline, leaving investors unable to access their money. The agency seized and attached properties worth over 163 crores ($19.5 million), including cash, cryptocurrency, bank balances, and office spaces.
The scam app came under scrutiny in 2022 when the company's funds were funneled into digital assets. The ED investigation discovered 2,500 fake bank accounts and found cash worth 19 crores ($2.2 million). The alleged ringleader, Aamir Khan, along with his accomplice Romen Agarwal, has been arrested and remains in custody. Given the use of digital assets for transferring funds, law enforcement was able to trace, freeze, and seize them.
Critics often cite cryptocurrency as a means for money laundering, but the transparency of blockchain technology makes it challenging to launder funds once discovered. Crypto exchanges have managed to trace and freeze funds linked to criminal activity in many cases.
One well-known example of blockchain transparency dates back to the 2016 Bitfinex hack. Hackers stole 119,756 Bitcoin from the exchange, but the individuals responsible were caught and arrested in 2022 when they attempted to launder the funds.
