Illegal betting case: ED cracks down on gaming platform Probo, freezes assets worth ₹284 crore

THE Enforcement Directorate on Wednesday said it has frozen fixed deposits and shares worth more than ₹284 crore belonging to a Haryana-based company, as part of a money laundering investigation linked to illegal online betting.

The action was taken under the criminal sections of the Prevention of Money Laundering Act (PMLA) after the agency conducted searches for two days starting Tuesday at four premises in Gurugram and Jind in Haryana, belonging to the firm Probo Media Technologies Pvt. Ltd. and its promoters Sachin Subhaschandra Gupta and Ashish Garg, news agency PTI reported.

The case pertains to alleged illegal online gambling, where complainants told police that they were "cheated" and "dishonestly" presented with a scheme of earning money through simple "yes or no" questions, while in reality, the scheme promotes "gambling" by luring players to invest more in the hope of earning higher returns.

The investigation found that the app/website "defrauds" users by first presenting a misleading image of a genuine skill-based platform, but ultimately "exploits" them through a betting system where winning depends entirely on chance, not on the user's knowledge or abilities.

According to the agency, the company described its platform as 'opinion trading', claiming that the game required knowledge and skill to play.

"However, analysis of games shows that all the games can be answered with a 'Yes or No' and hence, there are only two possible outcomes, which makes it indistinguishable from gambling/betting, resulting in loss of hard-earned money of the users," the probe agency told PTI.

The agency alleged that the app/website lacks any system to stop minors from signing up as users, does not carry out proper due diligence (KYC), and attracts new users with "misleading" advertisements while promoting opinion trading linked to election results.

The Enforcement Directorate (ED) said the company had received ₹134.84 crore from foreign entities based in Mauritius, the Cayman Islands, and other locations, against the issue of 'preference shares'.

"The searches resulted in the seizure of incriminating documents and digital data. Investment in FDs and shares amounting to ₹284.5 crore and three bank lockers have been frozen during the searches," it added.

Online platform Probo on Thursday said it was "cooperating" with the Enforcement Directorate (ED). "In light of recent developments, we would like to assure all stakeholders and the public that Probo is cooperating with law enforcement authorities in the ongoing inquiries."

"As pioneers of a nascent-yet-transformative technology in India's digital landscape, we remain confident that our commitment to compliance and innovation will help us emerge stronger through this process," a Probo spokesperson said in a statement to PTI.

The spokesperson added that they had "complete faith in India's robust regulatory framework and its vision for responsible tech innovation."