19 hours ago
Rs 55 cr yacht, minijet boat, Mercedes SUV among assets of OctaFX ‘mastermind' in Spain attached by ED
ED's investigation began in 2022, based on a case filed by Pune Police, which involved small-time investors who had complained of large-scale cheating through the application.
Pavel Prozorov has been identified and charged by the federal probe agency in the money laundering case. The agency has issued attachment orders for a minijet boat, a Mercedes-Benz EQV 300 Long SUV, and two residential properties in the European country.
New Delhi: The Enforcement Directorate has attached immovable properties in Spain, including a luxury yacht worth approximately Rs 55 crore, owned by the alleged mastermind behind Rs 900 crore fraud linked to forex trading platform OctaFX.
The probe revealed that the system was always stacked against investors, as the individuals running the OctaFX operations manipulated transactions through financial tactics, including frequent slippage and excessive leverage.
Later, the agency allegedly found that money defrauded from investors was routed from the primary account to several e-wallets or accounts, opened using fake documents or dummy entities during the initial process of layering illicit money.
The agency has alleged that OctaFX generated proceeds of crime to the tune of at least Rs 800 crore from its operations in India in just nine months. These funds were siphoned out of India in the guise of fake import of services to entities controlled by Prozorov across Spain, Estonia, Russia, Hong Kong, Singapore, the UAE, and the UK.
To make their operations appear more genuine, app promoters also established more than 30 dummy e-commerce sites, such as Miracantoy Creative, Bee Fintech Pay (OPC), and Razgoy Global, to create 'parallel evidence' in compliance with Reserve Bank of India (RBI) norms for firms dealing with the inflow and outflow of funds.
'Prozorov's exploitation of regulatory loopholes and the establishment of dummy entities in India exemplify his calculated approach to financial deception. He utilised these entities to manipulate records, allowing funds to be transferred overseas without raising suspicion. Additionally, Mr. Prozorov directed substantial promotional campaigns targeting Indian investors, including celebrity endorsements and sponsorships, further embedding OctaFX in the market,' the agency had alleged in the prosecution complaint filed in December last year.
'His actions constituted careful layering, placement, and integration of laundered funds as Foreign Direct Investment (FDI), misrepresenting their origins. Despite multiple summonses from the ED, Prozorov evaded compliance, indicating deliberate obstruction of legal processes. His direct involvement in establishing a complex web of entities and orchestrating financial flows clearly covered by Section 3 of the PMLA (Prevention of Money Laundering Act), as he engaged in the concealment, possession, acquisition, and use of proceeds of crime. He is also liable for punishment under Section 4 of the PMLA for his role in facilitating large-scale financial fraud and evading regulatory oversight,' it had further said.
The OctaFX team rejected ED's allegations, saying that it has been following regulations on payment service providers and typical industry practices.
'We strongly reject any claims that we mask payment gateway identities. URLs used in our payment integrations are part of the standard technical setup used by payment service providers, and usually, we are not involved in their construction. Based on the warranties of payment service providers, it is in line with applicable regulations,' the OctaFX team said in a statement to ThePrint.
'We aim to ensure that once customers select a payment method, they are redirected to the provider's official payment page, where their identity is clearly visible. The process is straightforward and follows typical industry practices.'
(Edited by Mannat Chugh)
Also Read: How a Pune investor's complaint blew lid off 'Rs 900-cr' fraud linked to OctaFx forex trading platform
