India’s Enforcement Directorate (ED) has launched an investigation into the activities and compliance levels of non-banking financial companies (NBCFs) to the Reserve Bank of India guidelines. So far, many companies have received sanctions, and Vauld is one of them.
The ED slapped Singapore-based cryptocurrency lender, Vauld with money laundering charges. Reports show that about $46.5 million (3.70 billion rupees) has been frozen from its local subsidiary, Flipvolt Technology.
The regulatory body, in a statement, confirmed that they were investigating Vauld and Yellow Tune Technologies for enabling illegal transactions through the crypto exchange. They also stated that Vauld failed to conduct due diligence on funds sent through the exchange and was uncompliant with their rules.
According to the regulator, the 23 organizations under investigation have reportedly made deposits of about 3.7 billion rupees into Yellow Tune’s crypto wallet addresses without following due process. Therefore, they consider this act suspicious.
They have also accused Vauld of showing little or no concern in tackling the case. The ED stated that the crypto exchange failed to present the KYC details of the wallets, could not explain the crypto transactions made by Yellow Tune, and had no EDD mechanism or mechanism of raising STRs. Therefore, they believe that these factors led the entity to avoid regular banking channels to easily take out laundered money in the form of crypto assets.
As a result of their illegal actions, the Indian ED has ordered that they will forfeit the laundered money to the tune of about $46 million until it provides comprehensive information in defense of the charges leveled against them.
It is also interesting to know that Vauld filed for bankruptcy last month after suspending its customers' withdrawals, trading and depositing. They reportedly owe their creditors about $363 million.
