The Enforcement Directorate (ED) has questioned senior executives at Paytm and picked up documents from them in response to the current Reserve Bank of India (RBI) motion, which barred Paytm Payments Bank Ltd from accepting deposits or top-ups in any buyer account.
The central company is conducting a preliminary examination of those documents to resolve whether or not to launch a proper investigation underneath the Foreign Exchange Management Act (FEMA) into alleged irregularities on the fintech firm.
While no irregularities have been detected up to now, the ED is searching for additional data primarily based on the documents supplied by Paytm executives. Any contravention underneath FEMA will result in the registration of a case. Additionally, an investigation underneath the Prevention of Money Laundering Act (PMLA) involving Paytm has been ongoing.
One97 Communications, the mother or father firm of Paytm, and its banking arm, Paytm Payments Bank, have been receiving notices and requests for data from authorities concerning their prospects. Paytm has clarified that its affiliate, Paytm Payments Bank Limited, doesn’t undertake outward international remittances.
Earlier this month, each the ED and the Financial Intelligence Unit (FIU) requested the RBI share its report on the current motion taken towards Paytm Payments Bank Ltd. The central financial institution had directed Paytm Payments Bank to cease accepting deposits or top-ups in any buyer accounts, wallets, FASTags, and different devices after February 29.
The ED’s investigation into Paytm is a part of a broader cash laundering probe towards Chinese-controlled cell apps accused of laundering funds by service provider IDs created on fintech platforms. Additionally, the FIU is analysing whether or not Paytm or PPBL adopted the required procedures as a “reporting entity” underneath the PMLA, which mandates monetary establishments to take care of information of all transactions and consumer identities.
