India’s Enforcement Directorate (ED) has busted a massive ₹400 crore ($48 million) scam involving the online gaming app Fiewin, linked to Chinese nationals. The app lured users with the promise of quick earnings but prevented withdrawals after users accumulated significant amounts. The agency has frozen ₹25 crore ($3 million) in funds linked to the scam’s perpetrators. The investigation also revealed the use of complex cryptocurrency channels to funnel the money to China.
The scam was orchestrated by a group of Chinese nationals in collaboration with several Indian accomplices, including Arun Sahu, Alok Sahu, and software engineers Chetan Prakash and Joseph Stalin. The ED, a premier financial crime agency under the Ministry of Finance, is spearheading the investigation. They received support from Binance, a leading cryptocurrency exchange, to track and trace the digital transactions linked to the fraudulent scheme.
The investigation has been underway for several months, as complaints from users grew over blocked withdrawals and lost funds. The ED’s recent findings were made public after freezing assets and tracing suspicious transactions involving cryptocurrency transfers.
The scam operated across India through the Fiewin app, an online gaming platform that targeted Indian users. Funds were funneled through a network of local operatives who converted them into cryptocurrencies before transferring them to wallets controlled by Chinese nationals. The complexity of the cross-border transactions highlights the challenges of tracking financial crimes in the digital age.
The scam aimed to exploit the increasing popularity of online gaming in India, drawing users with the promise of quick financial gains. Once significant funds were accumulated, withdrawal requests were blocked, trapping the money in the app. The ultimate goal was to move the money out of India using digital currencies to evade detection by local authorities.
The investigation revealed that the fraudsters used “recharge persons” to convert funds into cryptocurrency, which was then transferred to Chinese crypto wallets. Binance’s involvement helped authorities uncover the intricate web of transactions and communication channels used to hide the money trail. The probe has so far traced ₹400 crore to eight Binance wallets, and the ED is continuing its efforts to unravel the full extent of the cross-border scam.
This case highlights the growing threat of cybercrime in India’s online gaming and cryptocurrency markets, prompting authorities to intensify their regulatory oversight.
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