Mumbai: The Enforcement Directorate (ED) conducted searches at five companies, including Full Fledged Money Changers’ (FFMC) offices in Mumbai for FEMA violations, confiscating foreign currency worth Rs 4.6 crore. These establishments had their licences cancelled by RBI in Oct 2023 for failing to follow guidelines and conducting dubious transactions.
The investigating agency discovered that one of the searched companies had cash deposits of Rs 370 crore within 14 months. These firms were utilised for depositing money received through various channels. The transactions were found to be in violation of FEMA regulations.
The ED’s investigation revealed that these companies’ bank accounts were used to accumulate funds from different sources, which the FFMCs then used to purchase foreign currency in bulk from an AD-Category-II licensee agent. Subsequently, this foreign currency was distributed through unauthorised channels.
The probe uncovered that one FFMC’s bank accounts showed cash deposits exceeding Rs 370 crore during a brief 14-month period in 2022-23. The agency noted that the licensee agent was receiving substantial amounts from various FFMCs that lacked previous experience or expertise in handling such significant transaction volumes.