CRYPTOCURRENCY worth Rs 2,385 crore has been attached under the anti-money laundering law and the Spanish “mastermind” of the alleged multicrore OctaFX Ponzi scam has been arrested in that country, the Enforcement Directorate (ED) said on Friday. The case pertains to a “fraud” where several investors are alleged to have been duped on the false promise of high returns through the OctaFX forex trading platform. A provisional order has been issued under the Prevention of Money Laundering Act (PMLA) to attach cryptocurrencies worth Rs 2,385 crore in connection with the ongoing investigation against the “unauthorised” forex trading platform OctaFX.

 

The alleged mastermind of the fraud -- Pavel Prozorov -- has been arrested from Spain by the local police authorities, based on his involvement in cybercrimes affecting multiple countries, the agency said in a statement. A total of Rs 2,681 crore worth assets, including 19 immovable properties and a luxury yacht in Spain owned by Prozorov, have been attached by the ED in this case till now. OctaFX, as per the ED, “systematically duped” Indian investors of Rs 1,875 crore between July 2022-April 2023, generating profits of around Rs 800 crore, through a multi-country operation. The company operated from 2019-2024 and the total profits from India are estimated to exceed Rs 5,000 crore, much of which has been “illicitly” transferred overseas, it said. “OctaFX presented itself as an online forex trading platform for currency, commodities and crypto trading without RBIpermission.

 

“The initial investors receivedsmall profits to build trust, as isgenerally seen in a typical Ponzi scheme,” it said. The ED probe found thatOctaFX operated through a “distributed global network”designed to “evade” regulatoryscrutiny and it “layered” illicit funds across jurisdictions. handledby entitiesin theBritish Virgin Islands (BVI), some entities and persons based in Spain hosted servers and back-office operations, entities in Estonia managed payment gateways, those in Georgia provided technicalsupport andanentitylocatedinCyprus served as the“holding” company for the Indian entity. Some entities based in Dubai “oversaw” Indian operations via Russian promoters and persons inSingapore facilitated theexport of bogus services to launder funds abroad, as per the ED.