Indian Law Enforcement Charges WazirX Exchange With $130M Laundering.

India's Financial Crimes Enforcement Directorate (ED) is investigating cryptocurrency exchanges suspected of processing transactions that transported over 10 billion rupees, or $130 million, from organizations under investigation to worldwide wallets.

An official told The Economic Times that at least ten crypto exchanges are implicated, and WazirX's bank accounts were stopped.

Companies under investigation for instant loans allegedly made transactions of up to 1 billion rupees, or $1.3 million, in the names of unrelated people.

These firms often have Chinese ties. The agency alleged that no increased due diligence or suspicious transaction reports were lodged with the ED despite KYC/AML procedures indicating problematic transactions.

Last Friday, the ED blocked WazirX bank accounts containing 647 million rupees, or $8.1 million, alleging that the exchange supported 16 fintech companies under investigation for money laundering.

WazirX posted a statement on its blog Tuesday "on behalf of Zanmai Labs Pvt. Ltd," which it said cooperates with WazirX and Binance, stating that all users are subject to KYC/AML processes and the exchange fully cooperates with law authorities.

“For every transaction, we can create the applicable user's KYC details,” the blog post read.

WazirX's opaque ownership structure and Binance's role have been highlighted by claims.

Binance CEO Changpeng Zhao (CZ) tweeted Aug. 5 that the 2019 WazirX acquisition was not completed.

"We asked for transference of WazirX system source code, deployment, operations, as recently as Feb this year," CZ told WazirX cofounder Nischal Shetty the next day.

WazirX declined. Binance has no system control.”

WazirX was previously accused of weak AML measures.

In 2021, the ED accused WazirX of laundering unlawful online gambling earnings with a Chinese connection.

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