ED arrests WinZO founders after Rs 505 Cr asset freeze in money-laundering probe

The Enforcement Directorate has reportedly arrested the two founders of online gaming platform WinZO on charges of money laundering, indicating growing trouble for the Delhi-based company.

According to media reports, the company’s co-founders Saumya Singh Rathore and Paavan Nanda were taken into custody in Bengaluru after a round of questioning by the agency and they were later produced before a local court which granted one day custody for further interrogation.

The arrests follow a series of first information reports that accused the platform of cheating users, blocking withdrawal requests, manipulating game outcomes, using fake identities and misusing know your customer data. The allegations also include the use of automated systems that acted as simulated players in order to mislead genuine users.

ED hasn’t released any official statement on the arrest of the co-founders.

On November 24, ED carried out a major financial action and froze Rs 523 crore in assets linked to WinZO and another real money gaming operator Gameskraft. Of this, about Rs 505 crore belonged to WinZO in the form of bank balances, mutual funds, corporate bonds and fixed deposits. The remaining amount was linked to Gameskraft group entities including Nirdesa Networks which operates Pocket 52.

Investigators stated that the platforms continued to offer real money games to users in countries such as the United States, Brazil and Germany even after a nationwide prohibition came into force on August 22. The agency also claimed that player funds worth more than Rs 43 crore were held back without refund.

WinZO in its earlier official statement said it is fully compliant with the law and maintains that its systems and processes are designed to ensure fairness and transparency.

Entrackr has reached out to WinZo for more information.