Indian Probe Into Crypto Transfers Exceeding 4,900 Crore Rupees Covers Four Locations
Key Facts
India’s Enforcement Directorate searched four locations on October 27, three in Bengaluru and one in Madhya Pradesh, as part of an investigation into cross-border financial transfers using cryptocurrencies. Coverage put the total transfers under investigation at more than 4,900 crore rupees, while the case involved two separate tracks, according to Moneycontrol. The searches were conducted under Section 37 of the Foreign Exchange Management Act, 1999. The agency said one track began after it received complaints against RPFAS Technologies, which operates the Modulus and Saber Money platforms. The case places cross-border crypto transfer services under scrutiny by Indian foreign-exchange authorities, while details remain under investigation.
In the RPFAS case, the agency said initial findings indicated unauthorized crypto balances on foreign platforms exceeding 4,600 crore rupees. That figure refers to balances identified by the agency in this track, while 4,900 crore rupees is an overall estimate of the transfers covered in the report; neither figure is combined with the estimate for the separate Instadapp case. According to the agency, the two platforms advertised instant cross-border transfers using cryptocurrencies, including stablecoins such as USDT and USDC, without authorization from the Reserve Bank of India. The investigation presents these services as part of the activity being examined under foreign-exchange law. The available information contains no final finding establishing a violation or liability.
The agency said the searches uncovered large over-the-counter transactions and entities it described as shell companies registered in Canada and the United States, as well as the use of foreign platforms such as Bybit. In separate coverage dated October 30, The Indian Express reported that the transfers under investigation could reach 5,000 crore rupees, and that the probe covered over-the-counter trading platforms registered in Canada, Lithuania and the United States, along with other entities. The latest figure is a higher estimate than the 4,900 crore rupees cited in the earlier report. The agency said it is examining whether funds earned in foreign currencies were brought into India in violation of legal requirements. These details remain an account attributed to the ongoing investigation.
The second track concerns the Instadapp protocol, and initial findings estimated alleged violations linked to it at about 40 million dollars, or nearly 380 crore rupees. The agency said proceeds from stablecoins were credited to bank accounts in Singapore before being transferred to India as payments for software development and consulting services that it described as fictitious. This estimate remains separate from the figures linked to the RPFAS case and the broader transfers under investigation. The agency said its investigation into Instadapp transactions and related entities is ongoing. The published information contains no final ruling on the nature of the payments or the liability of any entity.
Guidelines from India’s Financial Intelligence Unit require digital asset service providers conducting specified activities to register with it before carrying out those activities. The unit considers failure to register a violation that may lead to action under anti-money laundering law. This framework brings digital exchange, transfer and custody services within India’s reporting and compliance requirements. In June, the Enforcement Directorate said it had identified cross-border transfers exceeding 2,500 crore rupees in a separate investigation, after searching five companies in Bengaluru on June 17. It added that bank accounts holding about 6 crore rupees were frozen in that investigation, which examined alleged transfers linked to cryptocurrencies.