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Wednesday, February 28, 2024

Following OctaFx’s Money Laundering Trouble, All Ponzi Forex Businesses Should Be Investigated ???

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India’s Enforcement Directorate in recent years has become a very hands-on authority to combat financial crimes in the country. With many prominent names under ED’s hitlist, OctaFx is the latest forex trading platform to make it to the list. On April 19, the Enforcement Directorate (ED) provisionally attached movable/immovable properties worth Rs. 34.75 crore in connection with the investigation of illegal forex trading platform OctaFx, its related entities, and others under the provisions of the Prevention of Money Laundering Act, 2002 (PMLA). The attachment includes bank balances, crypto currencies, automobiles, gold coins, and cash, among other things.

The ED launched an inquiry after Pune Police filed a FIR under several sections of the IPC 1860 and the MPID Act. Furthermore, the RBI has released an alert list of unauthorized entities/ETPs in a press release dated February 10, 2023, which includes OctaFx’s name. According to the ED investigation, the aforementioned online trading app and website are operating in India in collaboration with the India-based firm M/s OctaFx India Pvt. Ltd. This forex trading platform is heavily marketed on social networking sites and employs referral-based incentive structures to attract users to its platforms.

The investigation revealed that several accounts of different Indian banks were being displayed to investors/users on the OctaFx trading app for the purpose of collecting money under the premise of enabling FX trading. After scamming these investors/users, the amassed cash was moved to several e-wallet accounts or bank accounts of fictitious businesses for the aim of stacking. Furthermore, it has been shown that a large fraction of the fraudulent money on this trading software was utilized by OctaFx agents to accumulate personal fortune. It also revealed that OctaFx manipulated trade operations through its trading platform, resulting in a net loss for the traders.

These manipulative strategies include frequent fluctuations in slippage, the extension of massive leverages, and massive fraudulent ads in India over the internet in order to recruit unsuspecting investors. OctaFx has also engaged numerous Indians to work in Spain and Russia in order to operate the OctaFx trading platform and entice Indian residents to invest in forex trading with OctaFx.

The ED is further investigating the matter. “With a significant number of forex businesses in legal trouble, it is very important for these businesses to adhere to compliances and follow due diligence. It is also essential to keep up with the evolving regulations to shield your forex business from any obstacle in future”, says Adv. P.M. Mishra founder of Finlaw Consultancy Pvt.ltd https://finlaw.in/aml-kyc-pmla-consulting-services


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