CoinSwitch Kuber Under ED’s Lens on Suspicion of Violating Forex Laws

India’s Enforcement Directorate (ED) raided five properties associated with CoinSwitch Kuber on August 25, as it opened an investigation on the crypto exchange for allegedly violating forex laws. The company, founded in 2017, is being probed to check if it acquired shares worth more than $250 million (roughly Rs. 1,997 crore) in contravention of forex laws. India’s financial watchdog, the ED, is also investigating CoinSwitch for not keeping certain know-your-customer (KYC) requirements in compliance with India’s laws.

CoinSwitch shared a rather generic statement on this development, that vouched coordination with the government agencies.

“We receive queries from various government agencies. Our approach has always been that of transparency. Crypto is an early-stage industry with a lot of potential and we continuously engage with all stakeholders,” said a company spokesperson.

As for now, the ED has not shared elaborate details on its findings from searching CoinSwitch-related premises.

As per a report by CoinTelegraph, the offices and residences of senior CoinSwitch executives were also not spared from being searched by the ED officials.

Indian crypto exchanges have been going through a rough spell in recent times.

Back in July, CoinSwitch Kuber, along with CoinDCX and WazirX were served notices by the ED over alleged money laundering practices.

In August, the ED also opened a probe on WazirX crypto exchange over alleged predatory lending practices. As per the investigating authorities, a bunch of Chinese firms in the loan lending business, that were banned from operating in India, were using WazirX to wire their funds internationally via cryptocurrencies.

Amid these back-to-back confrontations between law enforcement agencies and Indian crypto firms, finance minister Nirmala Sitharaman has sounded an alert.

Earlier this month, Sitharaman warned members of the Indian crypto community to practice caution with their investments and safeguard themselves from financial risks.

At this point, India has over 115 million crypto investors, making for 15 percent of its massive population, a report by KuCoin crypto exchange recently said.