ED attaches luxury yacht, properties in Spain in case against OctaFX

This report has been updated  The Enforcement Directorate (ED) has attached offshore assets valued at ₹131.4 crore in its investigation against forex trading platform OctaFX. These include a luxury yacht named Cherry and two high-end residential properties located in Spain.

 

According to a News18 report, "Cherry", the luxury yacht, is an Italian commercial yacht cruising in the Western Mediterranean. The report suggests that these assets belong to Pavel Prozorov, a Russian national, allegedly the mastermind behind OctaFX, which was once promoted through the Indian Premier League (IPL) ad campaigns and was endorsed by celebrities.

 

This is the second instance when the offshore properties have been attached in this case. Previously, the probing agency attached 19 properties in Spain and other assets worth ₹296 crore.

 

The case also marks ED's second offshore attachment in a money laundering case, the first involved properties in Dubai, the report added, citing sources. 

Case details under investigation

 

ED said that in just nine months, the trading platform reportedly generated ₹800 crore in illicit proceeds by scamming thousands of Indian investors. Disguising itself as a legitimate forex broker, the platform lured victims with advertisements on social media, according to the News18 report.

 

The agency claimed that OctaFX manipulated trades behind the scenes and diverted investor funds through mule accounts. The funds were allegedly transferred overseas using fake import invoices, shell e-commerce firms, dummy directors, and several unauthorised payment gateways. 

ED alleges funds routed via fake e-commerce firms

 

In a statement, the ED said, "The directorate initiated an investigation based on an FIR registered by Shivaji Nagar PS, Pune, against several individuals for defrauding investors by falsely promising high returns through the OctaFX forex trading platform. And the investigation revealed that OctaFX, an unauthorised forex broker promoted via IPL, social media, and celebrities, laundered funds by collecting investor money through mule accounts in the names of fake e-commerce firms."

 

The investigation further revealed a web of dummy directors, shell companies, and bank accounts hidden under forged Know Your Customer (KYC).  

 

According to the ED, the diverted money was routed to companies linked to Prozorov across multiple regions, including Europe, Asia, and the Middle East. The network of transactions spanned jurisdictions such as Estonia, Russia, Hong Kong, the UAE, the UK, and Singapore.

 

The report reveals that Spain became Prozorov's haven, where he was investing the money laundered into a lavish lifestyle, including properties, which have now been attached by the central agency.

 

The special court under the Prevention of Money Laundering Act (PMLA) has taken cognisance in connection with this case. Citing an official, the report added that two complaints have already been filed against OctaFX and 54 others. 

Broker defends payment gateway practices

 

Octa has strongly denied allegations of false promises of high returns, quick riches, or guaranteed profits, mentioning that it doesn’t engage in any practices that disadvantage traders. “We consistently emphasise that Forex trading requires a knowledgeable and conscious approach. To support our clients in adapting this approach and making informed decisions, we provide comprehensive educational resources, which are publicly available on our website, YouTube channel, and app,” the company said in a response to Business Standard.   

 

The company said, like most global brokers, it worked with various payment systems and service providers. It emphasised that although these providers were integrated for user convenience, the company neither controlled nor interfered with their interactions with end-users.

 

“We strongly reject any claims that we mask payment gateway identities. URLs used in our payment integrations are part of the standard technical setup used by payment service providers, and usually, we are not involved in their construction. Based on the warranties of payment service providers, it is in line with applicable regulations. We aim to ensure that once customers select a payment method, they are redirected to the provider's official payment page, where their identity is clearly visible. The process is straightforward and follows typical industry practices,” OctaFX mentioned in a communication to Business Standard.