ED Probes Use of Crypto by D-Company, Raids Associates

The Enforcement Directorate (ED) is probing the use of the darknet and cryptocurrencies by India’s most-wanted fugitive, Dawood Ibrahim, amid suspicion that the underworld don has turned to digital tools to deploy the proceeds of crime raised through money laundering to invest primarily in offshore real estate.

Ibrahim has been found to be actively involved in various illicit businesses, including betting, drug trafficking and extortion, said people privy to the details of the probe.

“A substantial amount of the proceeds of crime raised through these illegal businesses has been invested to buy cryptocurrencies and purchase real estate,” said one of the officials, who did not wish to be identified. “Money is routed to wallets through hawala transactions and then these wallets are used to purchase real estate. The United Arab Emirates (UAE) is one of the preferred destinations both for purchase of wallets and investing in real estate. D-Company (Ibrahim’s criminal syndicate) has a strong hawala network to send money to the UAE.”

Earlier this week, the ED registered a case against Ibrahim and his close aids under the Prevention of Money Laundering Act and conducted raids across Mumbai, including against two city-based builders and Ibrahim’s late sister Haseena Parkar’s Nagpada residence. A close relative of Ibrahim’s trusted lieutenant, Chhota Shakeel, is being questioned by the agency. The case is based on a recent first information report registered by the National Investigation Agency.

“While crypto is a recent foray, the exact amount cannot be ascertained as the investigation is still underway and multiple transactions and money trails are being pursued,” said the official.

However, the use of the darknet, or computer network with restricted access that is mainly used for illegal file sharing, is making investigation difficult, according to officials.

“D-Company, darknet and crypto is a deadly mix. The trail in such transactions is difficult to retrace and investigation hits a roadblock,” said another official. “While the darknet makes betting easier, crypto coins help in financial dealing, leaving very little documentary evidence and making a probe next to impossible.”

Illegal betting has emerged as the main business of the D-Company during the Covid-19 pandemic, said officials.

“Though the pandemic restricted the movement of people, darknet and crypto ensured that the betting business thrived as usual. It’s a parallel economy which runs into thousands of crores and cryptocurrency is the new entrant to the ecosystem, making transactions easier,” said the second official.

Agencies including the ED, Narcotics Control Bureau, Central Bureau of Investigation and multiple state police units have raised concerns over the misuse of cryptocurrency, especially in terrorism and narco-terrorism. S-ET

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