India seizes $46 million from crypto exchange Vauld in money-laundering probe – TechCrunch
India’s Anti-Money Laundering Authority has frozen $46.4 million worth of assets from Vauld’s local legal entity to facilitate “criminal” proceeds from loan sharks in the past year. the latest wave of headaches for the crypto exchange that filed for protection from creditors last month.
Flipvolt Technologies, Singapore-based Vauld’s India-registered arm, was used to send 3.7 billion Indian rupees by 23 institutions including non-banking financial firms and fintech firms. into a wallet controlled by Yellow Tune Technologies, the Bureau of Enforcement said Friday. investigation.
The agency said Vauld’s Indian entity maintains “very lax KYC norms, no EDD mechanism, no depositor checks, no mechanism to increase STRs, etc”, factors causing the companies to allegedly “avoid conventional banking channels” and “easily obtain all fraudulent funds as crypto assets”.
India’s Vauld Foundation did not provide the agency with complete information about crypto transactions conducted by Yellow Tune and was also unable to provide wallet KYC details, the ED said.
“Loose KYC norms, lax regulatory controls in allowing money to be transferred to foreign wallets without asking for any reason/statement/KYC, no recording of transactions on Blockchains for savings expenses, etc., have ensured that Flipvolt cannot provide any account for the missing cryptocurrency,” it said. more (PDF).
“It has not made a sincere effort to track these crypto assets. By incentivizing opacity and having loose AML norms, it has actively assisted M/s Yellow Tune to launder Rs 370 Crore worth of crime proceeds using the crypto route. . “
The agency said it has frozen assets from the Vauld’s India entity until it provides a complete fund trail and the investigation is ongoing.
Vauld, that suspend its customers from withdrawing, trading and depositing funds on its eponymous platform last month, filed for bankruptcy last month and was reported as owes creditors $363 million, according to The Block news agency, cited legal documents it obtained. The startup includes Coinbase Ventures, Pantera Capital and Peter Thiel-backed Valar Ventures among its backers.