ED seizes Rs 288 crore from NBFC

The Enforcement Directorate has seized funds worth Rs 288 crore of a ‘Chinese-owned’ non-banking financial company (NBFC) which lent instant loans through mobile apps and later allegedly harassed borrowers by ‘misusing’ their personal data.

ED is investigating a number of NBFCs and Fintech companies under PMLA, 2002 for providing online instant micro-loans using mobile applications (APPs) and then extorting high rates of interest by misusing the personal data of the customers and allegedly threatening and abusing them through call centers.

“M/s PCFS is ultimately beneficially owned by Chinese national Zhou Yahui. Investigation revealed that the foreign parent companies of PCFS brought in FDI worth Rs 173 crore for lending business and within a short span of time, made foreign outward remittances worth `429.29 crore to Chinese-controlled companies,” a statement read.

PCFS also showed high domestic expenditure of Rs 941 crore. ED has found that exorbitant payments were blindly allowed by the dummy Indian Directors of PCFS without any due diligence and on the instructions of the Country Head Zhang Hong, who directly reports to Zhou Yahui of China. Hence, PCFS had contravened FEMA provisions and equivalent assets were liable for seizure. Hence, seizure orders were issued.