Karnataka: ED seizes Rs 527 crore after conducting nationwide raids on online gaming companies

Bengaluru: In a major crackdown under the Prevention of Money Laundering Act (PMLA), the Enforcement Directorate (ED) has seized bank deposits, bonds and mutual funds worth over ₹527 crore after conducting raids on multiple online gaming companies.

The ED carried out searches at the Bengaluru and Gurugram offices linked to the gaming app ‘Winzo’. During the operation, officials seized nearly ₹505 crore in bank deposits, bonds and mutual fund investments. According to investigators, Winzo Games Pvt. Ltd. had been defrauding its users by manipulating game results using hidden algorithms and software tools designed to ensure players lost money.

Officials revealed that the company created a fraudulent offshore entity named Winzo US Inc. Through this shell company, around USD 55 million (approximately ₹489.9 crore) was allegedly siphoned off illegally from India to the United States and Singapore. Even after the central government banned real-money gaming under the “Promotion and Regulation of Online Gaming Act, 2025,” the company reportedly withheld ₹43 crore that should have been refunded to users.

The ED has intensified its probe and continues to examine the financial trail, including suspicious fund movements across international borders. In a parallel operation, the agency also conducted raids on two other gaming companies—‘Pocket52’ (operated by NDS Networks Pvt. Ltd.) and ‘Gameskraft Technologies’—based on complaints of large-scale cheating and fraudulent manipulation of online game outcomes.

Investigators stated that Pocket52 was predetermining game outcomes and deliberately introducing technical glitches to ensure users lost money. One user alone reportedly lost ₹3 crore due to this systematic manipulation.

Despite the nationwide ban on real-money games, both companies allegedly withheld more than ₹30 crore belonging to customers by keeping the funds locked in their escrow accounts instead of returning them. The ED seized mobile phones, laptops and documents from the directors of these companies and froze eight bank accounts containing ₹18.57 crore.

The ED’s findings point to a widespread pattern of fraud in the online gaming industry, involving sophisticated technical manipulation, illegal fund transfers and deliberate cheating of users on a large scale. Further investigation is underway to determine the extent of criminal violations and identify additional beneficiaries of the illicit operations.