The Enforcement Directorate (ED) has intensified its crackdown on alleged money laundering activities associated with the Fairplay App, a subsidiary of the Mahadev Book app network, by conducting raids at 19 locations across Mumbai and Pune. In a significant development, movable assets, including incriminating documents, digital devices, cash, bank funds, demat account holdings, and luxury watches, with an estimated value of INR 8 crore, have been seized.
Allegations and Investigations
The Fairplay App has come under scrutiny for its purported involvement in illegal broadcasting of cricket and IPL matches, as well as various online betting activities, including influencing the results of the Lok Sabha Elections 2024. The probe was triggered by a First Information Report (FIR) filed by the Nodal Cyber Police in Mumbai, prompted by a complaint from Viacom18 Media Private Limited.
Legal Ramifications
The FIR invokes multiple sections of the Indian Penal Code (IPC) 1860, the Information Technology Act 2000, and the Copyright Act 1957, accusing Fairplay Sport LLC and others of causing a revenue loss exceeding INR 100 crore, deemed proceeds of crime. The ED investigation revealed intricate webs of financial transactions, alleging that Fairplay Sport LLC engaged in agreements with foreign-based entities in Dubai and Curacao, collaborating with Indian agencies representing celebrities.
Modus Operandi Unveiled
According to the ED, Fairplay amassed funds through shell bank accounts, which were subsequently routed through a labyrinthine network of bank accounts associated with shell entities. These funds allegedly found their way into pharmaceutical companies engaged in fraudulent billing practices. Further investigation exposed the diversion of funds to overseas shell entities based in Hong Kong SAR, China, and Dubai. More than 400 bank accounts linked to shell entities are under scrutiny, along with the trail and utilization of funds collected from the public by Fairplay.
Illegal Betting and Gambling Nexus
The nexus between the Fairplay App and illegal sports betting platforms like Parimatch, Betway, 1XBet, Betfair, Crickex, and Lotus365 has raised significant concerns. These platforms reportedly intensified their operations during the Indian Premier League (IPL), enticing cricket enthusiasts with discounts and ‘treasure hunts’ for match tickets. It is imperative to note that betting and gambling are strictly prohibited under the Public Gambling Act 1867 and are deemed illegal across most regions in India.
Regulatory Response and Advisory
Earlier this year, the Central Consumer Protection Authority (CCPA) issued an advisory cautioning celebrities and influencers against promoting illegal activities. This regulatory intervention underscores the imperative of collective vigilance and adherence to legal frameworks in combating unlawful practices within the digital ecosystem.
