Enforcement Directorate on Online Gaming Fraud: ₹18.57 Crore Frozen Under PMLA.

Headnote:

The Enforcement Directorate (ED) conducted extensive search operations across Bengaluru and Gurugram targeting M/s Nirdesa Networks Pvt. Ltd. (Pocket52), Gameskraft Technologies Pvt. Ltd., and residences of their directors and associated persons. The action followed allegations of large-scale fraud, manipulation of online gaming outcomes, withholding player funds, and continued violations even after the enactment of the Promotion and Regulation of Online Gaming Act, 2025. ED seized incriminating digital devices and froze eight escrow bank accounts containing ₹18.57 crore, suspected to be proceeds of crime.

Background:

• ED initiated a PMLA investigation based on an FIR by Karnataka Police alleging that Pocket52 manipulated gaming algorithms, enabled player collusion, imposed withdrawal restrictions, and intentionally created technical glitches.

• The complainant claimed losses exceeding ₹3 crore, stating that Pocket52 removed transparency features (such as hand history) and ignored responsible gaming norms.

• Company leadership of Nirdesa Networks Pvt. Ltd. was accused of rigging algorithms and engaging in unfair play, prompting registration of offences for cheating and regulatory violations.

• ED conducted searches at the offices of NNPL and GTPL, and the residences of directors/founders involved in the suspected fraud.

ED’s Findings & Observations:

• Multiple users had lodged complaints alleging manipulated game outcomes, lack of transparency, and deliberate exploitation by the platform.

• ED seized mobile phones, laptops, and other digital devices from directors and founders, along with large volumes of data from Gameskraft Technologies Pvt. Ltd.

• Despite the ban on Real Money Games under the Promotion and Regulation of Online Gaming Act, 2025 (enacted on 22.08.2025), more than ₹30 crore remained in company escrow accounts without being refunded to players.

• ED froze 8 escrow bank accounts holding approximately ₹18.57 crore under Section 17(1A) of PMLA, identifying these funds as suspected proceeds of crime.

• Investigation is ongoing.

Legal Provisions Discussed:

• Prevention of Money Laundering Act, 2002 (PMLA) – Search, seizure, and freezing of accounts under Section 17(1A).

• Promotion and Regulation of Online Gaming Act, 2025 (PROG Act) – Ban on real money gaming and regulatory compliance.

• Indian Penal Code (via FIR) – Cheating, fraud, manipulation, and other offences forming the predicate crime.

Citation: ED/BLR/Press/2025/11/24

Case: Directorate of Enforcement, Bengaluru Zonal Office – Search & Seizure Action

Authority: Directorate of Enforcement (ED), Government of India

Coram: Not Applicable (Administrative Proceedings)

Date of Action: 18–22 November 2025

Proceeding Under: Prevention of Money Laundering Act, 2002