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The Enforcement Directorate has traced alleged illegal betting and cyber fraud proceeds through mule accounts at a Hyderabad bank.
How Were Mule Accounts Used to Transfer Funds?
The Enforcement Directorate (ED) has uncovered an alleged money-laundering network involving multiple mule accounts at Jubilee Hills Mercantile Cooperative Bank in Hyderabad. Investigators believe the accounts were used to route proceeds from illegal online betting and cyber fraud before transferring the money to shell entities and a Bengaluru-based cooperative society.
The investigation is linked to the All Panel Exchange (APX) online gaming and betting platform. According to the ED, hundreds of crores of rupees were moved through a network of bank accounts and entities allegedly connected to illegal gaming operations.
The money-laundering investigation originated from three FIRs involving online gaming, betting and cyber fraud, in which complainants allegedly lost crores of rupees. Investigators are examining the movement of funds to establish how the suspected proceeds were received, transferred and subsequently handled.
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What Did Investigators Find in Bengaluru?
Financial scrutiny revealed that substantial amounts from the suspected shell entities were transferred to the nodal account of Nagarbhavi Credit Cooperative Society in Bengaluru.
The account was maintained on behalf of Armstrong Exchange, an entity established by a person identified as Dash. Investigators found that hundreds of crores of rupees had passed through the cooperative society’s bank account, including substantial amounts allegedly originating from illegal gaming and betting platforms associated with cyber fraud.
The ED further alleged that Dash used the cooperative society’s Know Your Customer (KYC) documents and fabricated records to open a cryptocurrency account.
The suspected use of cooperative banking accounts, shell entities and cryptocurrency-related arrangements has become a significant part of the financial investigation. Authorities are examining the transactions to establish the movement of funds through the different entities.
What Action Has the Enforcement Directorate Taken?
The ED previously conducted searches at multiple locations across Hyderabad, Pune, Mumbai, Bengaluru, Surat and Mehsana in Gujarat. These operations resulted in the seizure of documents and the freezing of approximately ₹9 crore held across multiple bank accounts.
The agency had also arrested Ram U Ramdhani, chief executive officer of Edsom Fintech, in connection with the investigation.
A special court dealing with cases under the Prevention of Money Laundering Act (PMLA) in Mumbai subsequently remanded a male accused to three days of ED custody. The available details do not clearly establish the identity of the person referred to in that custody order.
The searches, arrests and examination of banking records form part of the continuing effort to identify the individuals and entities allegedly involved in handling the suspected proceeds.
What Is the Focus of the Continuing Investigation?
Investigators are examining the financial connections between the Hyderabad-based mule accounts, suspected shell entities, Armstrong Exchange and Nagarbhavi Credit Cooperative Society. The inquiry is also examining the alleged use of fabricated KYC documents to establish cryptocurrency-related banking arrangements.
The movement of hundreds of crores through cooperative banking channels has raised questions about the role of intermediary accounts in transferring funds linked to suspected illegal betting and cyber fraud.
The ED’s findings remain allegations under investigation. Further examination of the financial records is underway to establish the transactions, identify those responsible and determine the full extent of the suspected money-laundering network.
