OctaFX Forex Scam: ED attaches Rs 2,385 crore in crypto, mastermind held

The Enforcement Directorate ED in Mumbai has issued a provisional attachment order seizing cryptocurrency assets worth around Rs 2385 crore in connection with the alleged OctaFX Forex Scam officials said adding that the mastermind in the case was held in SpainThe action was taken under the Prevention of Money Laundering Act PMLA 2002 as part of an ongoing investigation into the illegal forex trading platform OctaFXThe ED revealed that Pavel Prozorov the mastermind behind the scam was arrested by Spanish police authorities in connection with cybercrimes across multiple countries an official statement said on FridayThe ED had launched its investigation following an FIR by Punersquos Shivaji Nagar Police Station The complaint stated that investors were lured into putting money into OctaFX with promises of high returns through online forex trading it saidInvestigations revealed that between July 2022 and April 2023 OctaFX duped Indian investors of nearly Rs 1875 crore generating around Rs 800 crore in profits during that period alone Across operations from 2019 to 2024 the platform is estimated to have earned over Rs 5000 crore from Indian investors most of which was illegally sent abroad they saidOctaFX posed as a legitimate trading platform for currencies commodities and cryptocurrencies despite having no permission from the Reserve Bank of India RBI In typical Ponzi scheme fashion early investors were given small returns to gain trust and attract more clients the official statement saidIt said that the probe uncovered a complex global network designed to dodge regulations Different arms of the operation were based in countries like Spain Estonia Georgia Cyprus Dubai Singapore and the British Virgin Islands BVI These entities handled everything from marketing and technical support to payment processing and fund launderingOctaFX allegedly manipulated trades by using fake charts and causing intentional ldquoslippagerdquo to ensure clients made losses It also ran a referral programme where Introducing Brokers IBs earned large commissions for bringing in new investors the statement further saidIndian investorsrsquo funds were collected using UPI and local bank transfers often routed through dummy companies and mule accounts Unauthorised payment aggregators helped disguise the transactions as normal online purchases Eventually the funds were transferred abroad in the name of fake software and RampD imports to shell firms controlled by Prozorov in several countries an official press release saidSome of the laundered money returned to India disguised as foreign direct investment FDI while the rest was spent on luxury assets including a yacht real estate and expansion of OctaFX operations worldwide A portion of the illicit wealth was parked in cryptocurrency wallets under Prozorovrsquos control it saidSo far the ED has attached assets worth Rs 2681 crore including 19 immovable properties and a luxury yacht in Spain The ED has already filed a Prosecution Complaint and a Supplementary Complaint against OctaFX and 54 other accused personsentities which has been accepted by the Special PMLA CourtFurther investigations are ongoing officials said