Binance said that the law enforcement department was able to uncover the fraud network thanks to crucial intelligence from its Financial Investigations Unit.
In one of the latest collaborations between public and private entities, the worldâs largest cryptocurrency exchange, Binance, announced that it helped Indian authorities uncover an allegedly legitimate online gaming app that defrauded users of more than Rs 400 crore ($47.6 million).
According to a blog post, Binanceâs Financial Intelligence Unit (FIU) provided crucial assistance that enabled Indiaâs Enforcement Directorate (ED) to trace funds transferred by the operators of the Fiewin gaming app and uncover the network.
Binance Assists ED in Fraud Case
Fiewinâs operators marketed the app as a project that allowed users to earn money by playing mini-games. Participants could create accounts and participate in the appâs activities by topping up their balances through various payment methods. However, the app stopped allowing users to withdraw their funds once they accumulated large amounts in their accounts, and the funds would eventually be withdrawn through a backdoor to multiple crypto wallets.
The DEA launched an investigation into the Fiewin app after local police across the country began receiving multiple reports from victims who had lost money to the scheme. During the investigation, the agency found that Fiewin was linked to a cross-border criminal network that used multiple methods to hide the movement of illicit funds, including money changersâ bank accounts and multiple cryptocurrency wallets.
The Indian agency also discovered that the project had stolen millions of Indian rupees from users and created a complex web of transactions to prevent the funds from being detected and traced. With the help of Binance, the Indian agency was able to trace the flow of laundered funds across multiple crypto wallets and uncover the vast fraud network.
âCollaboration between the public and private sectors is critical in tackling complex financial crimes. Binanceâs dedicated investigation team is a great example of how private sector companies can work closely with law enforcement. In this case, they provided us with analytical support that contributed to the investigation,â said an FBI representative.
Four people arrested
In addition to uncovering the fraud network, the Anti-Fraud Departmentâs investigation also led to the arrest of four individuals who played a key role in facilitating the fraud and worked with the operators of the Fiewin app. The perpetrators of the fraud were found to have used privacy-focused messaging apps to communicate while working from different locations.
Binance said the case is still ongoing, and the ED is looking to uncover the criminal network behind the fraud scheme and uncover the full extent of Fiewinâs activities.
