ED conducting searches on some Paytm, PayU premises: Report

The Enforcement Directorate was conducting searches on certain premises of One 97 Communications Ltd's Paytm and payment solutions provider PayU, according to a Reuters report.

Commenting on the matter, a Paytm spokesperson said, “As we have mentioned before, ED continues to seek information about certain merchants from various payment service providers, we have shared the required information.”

Recently, the ED had conducted raids at Bengaluru premises of online payment gateways such as Razorpay, Paytm, and Cashfree Payments as part of an ongoing probe against "illegal" instant smartphone-based loans "controlled" by Chinese persons.

The searches were conducted at six premises in Karnataka's capital city, the ED had said in a statement.

The federal probe agency informed that it has seized ₹17 crore worth of funds kept in "merchant IDs and bank accounts of these Chinese persons-controlled entities" during the raids.

The modus operandi of these entities is that they use forged documents of Indians and make them dummy directors, leading to the generation of "proceeds of crime", ED had alleged.

"These entities are controlled/operated by Chinese persons," it added. "It has come to notice that the said entities were doing their suspected/illegal business through various merchant IDs/accounts held with payment gateways/banks."

The agency said that the entities under investigation were generating proceeds of crime via several merchant IDs/accounts held with payment gateways/banks, and they are also not operating from the addresses given on the MCA (ministry of corporate affairs) website/registered address and they have "fake" addresses.