PhonePe, Easebuzz Among 20 Firms Probed In Rs 500 Crore Investment Fraud

The Intelligence Fusion and Strategic Operations (IFSO) unit is a specialised team focused on investigating cybercrime in India, working in collaboration with various agencies

Payment aggregator platforms PhonePe and Easebuzz are being investigated by the Delhi Police’s cyber security cell, specifically the Intelligence Fusion and Strategic Operations (IFSO) unit, for potential negligence in the establishment of merchant accounts associated with a Rs 500 crore investment scam. 

This extensive fraud has affected over 30,000 individuals misled into investing in the Hibox mobile application. The app falsely promised high returns, offering daily interest rates between 1 per cent and 5 per cent, according to IFSO, reported Business Standard.

“Apps like PhonePe and others have not followed the Reserve Bank of India guidelines while opening virtual merchant accounts, and are being probed to find out whether this was a mistake or if they were actively involved,” Hemant Tiwari, deputy commissioner of police, IFSO, Special Cell, Delhi Police, told the publication.

In a statement to ABP Live, Easebuzz said, "The merchant in reference is proactively blocked by Easebuzz platform in the month of July 2024 itself prior to the investigation by authorities. Moreover, Easebuzz has filed the Suspicious Transaction Report (STR) under the Financial Intelligence Unit, India (FIU) reporting norms immediately on receipt of our internal transaction monitoring system alerts in place and has blocked the merchant from transacting as per our company compliance policies. Further, Easebuzz is confident in its merchant onboarding and due diligence policy and necessary details of the merchant (KYC details, Transaction ledger and others documents) as required by the authorities have been duly submitted. Easebuzz ensures to remain compliant and cooperate with the authorities in the investigation process against the merchant."

The Intelligence Fusion and Strategic Operations (IFSO) unit is a specialised team focused on investigating cybercrime in India, working in collaboration with various agencies. In an official statement, IFSO indicated that the potential involvement of employees from the payment platforms could not be dismissed, and the investigation is currently ongoing.

In addition to the two payment aggregators, Tiwari stated that approximately 20 other firms are also being investigated for their involvement in laundering money connected to the scam. "We are investigating this and will soon refer these firms to the Enforcement Directorate for further action," he added. 

The special cell has also issued notices to several prominent social media influencers, including Abhishek Malhan, Elvish Yadav, Lakshay Choudhary, and Purav Jha, among others, requesting their participation in the investigation regarding their alleged roles in promoting the fraudulent platform. “Many victims were drawn in through the promotion of the app by popular social media influencers and YouTubers,” said IFSO.

The Delhi Police have consolidated approximately 127 complaints related to the Hibox app and have apprehended the primary suspect, recovering Rs 18 crore from four different bank accounts, as per the report.