Following an alert by India’s Financial Intelligence Unit, agencies are probing these transactions that took place between 2019 and 2021.
Indian investigation agencies are probing three crypto exchanges for their roles in illegal drug trade transactions after they were alerted by the Financial Intelligence Unit (FIU), which has zeroed in on nearly 200 such transactions.
These financial dealings for suspected drug deals in Nigeria, the Cayman Islands, and the British Virgin Islands were reportedly carried out through three Indian digital asset management companies, a report in the Economic Times said.
Illegal Drug Transactions
Enforcement Directorate (ED) and Income Tax Department, among other agencies, are probing the case.
“Digital currency was used to buy and sell drugs and some of these companies facilitated it…So far the agency has been able to track transactions worth Rs 28,000 crore [$3.5 billion],” the Economic Times quoted an unnamed senior government official.
A majority of these transactions were carried out through these three crypto firms, and they were not reported to the authorities, investigators believe.
As per the media coverage, these transactions that took place between 2019 and 2022 came to light after several drug traffickers were arrested by the Hyderabad Narcotics Enforcement Wing. They used to operate on the Dark Web and use crypto for payments.
The FIU is a national agency that receives all reports of suspicious financial transactions from Indian probe agencies and cooperates extensively with law enforcement agencies internationally in investigating terror and drug financing.
Gaze on Dark Net and Crypto
India’s Home Minister Amit Shah last week said at a high-level meeting on drug trafficking and national security that cases of drug smuggling through the dark net and cryptocurrencies have increased in recent years.
For the last several months, Indian investigating agencies are proactively chasing frauds and wrongdoings in the local crypto space. Early this month, the ED raided several premises linked to the accused of a gaming app scam and recovered cash and bitcoins, which were frozen.
In August, the ED searched the office and residences of CoinSwitch Kuber’s top executives, including the directors and CEO, for suspected violation of foreign exchange rules. Earlier, it was reported that ED was investigating 10 private companies for money laundering of $125 million.