Fairplay App Money Laundering Case: ED Alleges ₹4679 Crore Remitted Abroad Between March 2023 And August 2024

Mumbai: The Enforcement Directorate has submitted a prosecution complaint in connection with money laundering by Fairplay, alleging that approximately ₹4679 crore was remitted outside India in a short span between March 2023 and August 2024. These funds were later brought back into India for further investments in movable and immovable assets.

Earlier this month, the ED submitted a prosecution complaint against Fairplay Sport LLC, Fairplay Management DMCC, Fairplay Sports, Krish Shah, Chirag Shah, Chintan Shah, Siddhant Iyer, Shah Farms LLP, Swastik Enterprises, Wohling Transformation Pvt. Limited, and its subsidiary Wohling Transformation Fze LLC. On Friday, the special PMLA court took cognizance of the complaint and ordered the initiation of prosecution for money laundering against them.

The ED claimed that Krish Shah is said to be the mastermind behind the online gaming portal Fairplay. Krish and Chirag allegedly incorporated Fanq Gaming Pvt. Ltd. in 2020 to venture into the online gaming industry in India. However, due to legal complexities, Fairplay was incorporated in Curacao, with additional entities established in Dubai, Malta, and other jurisdictions.

The investigation into the money trail revealed that Fairplay administrators used dummy bank accounts of shell entities to collect funds from Fairplay users. These funds were layered in dummy bank accounts of shell entities. It was noted that these dummy bank accounts, created under various individuals' names, were used only for short durations and were changed regularly to avoid detection by law enforcement agencies, according to the ED.

The ED claimed that scrutiny of these bank accounts revealed that over ₹4000 crore was remitted outside India in a short time frame. “Fairplay structured its operations through a network of offshore entities to evade legal and regulatory oversight in India. Despite having no formal legal presence in India, the platform engaged in illegal betting, unauthorized streaming, and other illicit activities,” the ED claimed.

The agency alleged that user funds were collected through dummy and mule accounts, layered via multiple financial transactions to obscure their origin, and subsequently remitted abroad under fabricated import/export transactions and fictitious investments. “Additionally, substantial amounts were routed back into the Indian economy for the acquisition of assets, establishing a deliberate and systematic scheme of money laundering,” the ED probe revealed.

The probe further revealed that most transactions took place between April 2023 and May 2024. It was also reported that various bank accounts were frozen by Nodal Cyber Police, Mumbai, and other law enforcement agencies.

These entities and firms were found to have no physical presence. When the agency physically verified the addresses mentioned by these entities, it discovered that no such entities existed.

“These are paper or shell entities used for layering of funds. Most of the pharma companies’ bank accounts were opened in 2023, and most of the companies were registered with the Registrar of Companies, Mumbai, during the months of March 2023 to August 2023,” the ED claimed.

The ED stated that the funds remitted outside India were later transferred back into the accounts of Krish, his wife Tanvi, mother Jayshree, Chirag, Chintan, Snehal Gadhecha, a firm named Shah Farms, and Wohling Transformations Pvt. Limited.

The agency has so far arrested Chirag and Chintan while Krish, his wife Tanvi and Iyer who is looking after the financial management are shown as wanted accused by the agency. The agency claims that three have shifted to Dubai.

Meanwhile, Chirag in his statement has claimed that Fairplay was fully owned by Krish. However, later in April 2023, Krish sold 70% ownership rights to Saurabh Chandrakar for an amount of Rs 30 crores. However, as Chandrakar couldnot pay full amount to Krish, 30% ownership was reverted back to Krish in November 2023. Thereafter Krish has shifted his business at the new gaming site at M/s Superwin, Chirag has said in his statement.