ED searches some Paytm, PayU offices related to transactions with Chinese shell companies

Paytm spokesperson said, "As we have mentioned before, ED continues to seek information about certain merchants from various payment service providers, we have shared the required information."

The Chinese loan apps case is based on 18 FIRs registered by the Cyber Crime Police Station in Bengaluru City against numerous entities/persons in connection with their involvement in extortion and harassment of the public who had availed small amount of loans through the mobile apps being run by those entities/persons, the ED said earlier.

During the investigation, it was revealed that the entities are controlled/operated by Chinese Persons.

"The modus operandi of these entities is by using forged documents of Indians and making them as dummy directors of those entities, they are generating proceeds of crime," the statement read.

Moreover, the agency noticed that the said entities were doing their suspected or illegal business through various Merchant IDs/Accounts held with Payment Gateways/banks.

“They are also not operating from the addresses given on the MCA website/registered address and having fake addresses. An amount of Rs 17 crore have been seized in merchant IDs and bank accounts of these Chinese persons-controlled entities,” the federal agency said.