New Delhi [India], October 9 : The Enforcement Directorate (ED) on Thursday carried out searches in the case of KC Veerendra, Congress Member of the Legislative Assembly (MLA) from the Chitradurga constituency in Karnataka, and others related to cheating the public in an illegal online betting case.
In a search operation conducted by the ED's Bengaluru zonal office under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, the agency claimed to have seized 24-carat gold bullion weighing 40 kg, worth Rs 50.33 crore, from two lockers in Challakere, Karnataka. Earlier, ED has seized assets worth Rs 103 crore in the form of around 21 kg gold bars, cash, gold and silver jewellery, bank accounts and high-end vehicles. Total seizure in the case is more than Rs 150 crore till date.
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The searches and tracing of Proceeds of Crime in an illegal online betting case have been undertaken during the Judicial custody of the prime accused, Veerendra, who was arrested in August this year.
ED said its investigation revealed that "Veerendra, in association with other friends and family members, is involved in operations of many illegal online betting websites, viz. King567, Raja567, etc and cheating innocent players through the same."
Furthermore, the agency stated that funds collected from players have been routed through several gateways, like FonePaisa.
"The money so collected is routed through several mule accounts which are sourced by these betting operators from intermediaries from all across India."
ED investigation has revealed a nexus of online betting apps with isolated instances of cybercrime across India, by way of mule accounts creation in the name of individuals in exchange for petty sums. "The estimated turnover of these betting applications being controlled by Veerendra is more than Rs 2,000 crore. Veerendra, his family members and associates have booked several international travel tickets, visa and other hospitality services worth crores of rupees, financed through a network of mule accounts linked to proceeds from online betting websites."
Further, the ED said, expenses like marketing, bulk SMS services, platform hosting, Search Engine Optimization etc. with respect to operations of these mule accounts is also paid through these accounts controlled by Veerendra and his associates.
"The evidences suggest that the funds used for these high-value transactions were diverted from illicit online activities and funnelled through multiple intermediary accounts to obscure their origin," added the ED.