India busts e-Nuggets scam with help from Binance

India’s enforcement authority has seized roughly 90 crores ($10.5 million) from an online scam app called E-Nuggets, in a crackdown involving major cryptocurrency exchanges like Binance, ZebPay, and WazirX.

These exchanges helped in identifying and blocking the crypto wallet accounts linked to the scam.

According to The Hindu, E-Nuggets stored cryptocurrencies valued at $10 million across 70 different crypto wallet accounts on these exchanges. The Enforcement Directorate (ED) took action by instructing the exchanges to freeze the implicated wallet addresses and transfer the assets to the agency’s own wallet.

The E-Nuggets app allegedly attracted customers with promises of high returns on investments, posing as a gaming platform. It offered various real-money games with big commissions, requiring users to put down money. However, once the investments were made, the app shut down operations, effectively trapping the investors’ funds.

The investigation into the E-Nuggets app began in 2022 when suspicious transactions involving digital assets were noted. This led to the uncovering of around 2,500 dummy bank accounts and the seizure of assets worth over 163 crores ($19.5 million), which included cash, cryptocurrencies, account balances, and office properties.

Aamir Khan, identified as the brains behind the scam, and his accomplice Romen Agarwal, have been arrested and are currently in custody. The use of digital assets in the scam enabled authorities to effectively trace and secure the illicit funds.

Binance, the world’s largest cryptocurrency exchange, is preparing to re-enter the Indian market after agreeing to pay a $2 million fine.

The fine comes as a resolution to compliance issues that led to Binance’s removal from the Apple Store in India earlier this year following show cause notices from India’s Financial Intelligence Unit (FIU).

The notices, which were also sent to other major exchanges such as OKX, KuCoin, and Huobi, were part of a broader crackdown on crypto exchanges operating without full compliance with local regulations.

Following the fine, Binance plans to re-establish itself as an FIU-registered entity, fully compliant with Indian regulations, including anti-money laundering and taxation laws.