ED Arrests WinZO Founders On Money Laundering Charges — Details Inside

The Enforcement Directorate has arrested online money gaming platform WinZO founders, Saumya Singh Rathore and Paavan Nanda on money laundering charges, PTI reported quoting sources.

They were arrested in Bengaluru on Wednesday following their questioning at the zonal office of the federal probe agency, the report added.

The two were produced before a local court in Bengaluru on Wednesday night and were sent to one-day custody by the court. The founders are expected to be produced again before the court for a detailed order, PTI reported quoting official's familiar with the matter.

On Monday, the ED, in a statement, alleged that funds to the tune of Rs 43 crore of gamers were 'held' by the company. When ideall the money should have been refunded to players after India banned real-money gaming.

The ED had raided the premises of WinZO and Gamezkraft, another company offering online gaming, and their promoters last week under the provisions of the Prevention of Money Laundering Act (PMLA).

The ED had accused WinZO of 'engaging in criminal activities and unscrupulous practices as customers were made to play with algorithms without being made aware of the fact that they are playing with the software and not with humans in real-money games.'

It said WinZO was operating real-money games (RMGs) in countries such as Brazil, the US, and Germany, from India (on the same platform used by the Indian entity).

It said bonds, fixed deposits, and mutual funds worth Rs 505 crore 'possessed' by WinZO Games, were frozen under the Prevention of Money Laundering Act (PMLA).

WinZO, the ED said, also prevented or limited withdrawals of money held by the customers in the wallets and generated alleged illicit funds in the form of bet amounts placed and lost by real customers through the 'unscrupulous' use of algorithms/software.

The agency claimed to have found that WinZO's global operations were undertaken through a single app, meaning they were hosted on the India-based platform.

WinZO spokesperson in response said, "Fairness and transparency are core to how WinZO designs and operates its platform."

"Our focus remains on protecting our users and ensuring a secure, trustworthy experience," WinZO spokesperson said in a statement adding that it remains fully compliant with all applicable laws.

(With inputs from PTI)