India’s Enforcement Directorate (ED) has executed one of the nation’s most significant cryptocurrency seizures, attaching movable properties in the form of cryptocurrencies worth approximately ₹2,385 crore (about $286 million as of October 2025) under the Prevention of Money Laundering Act (PMLA), 2002. This dramatic action is a crucial part of the ongoing investigation into the OctaFX forex trading platform, an unauthorized platform that allegedly defrauded thousands of Indian investors. The seizure underscores the government’s intensifying scrutiny of digital asset misuse and its robust commitment to regulating crypto-linked financial crimes under existing anti-money laundering frameworks.
What is the OctaFX Forex Scam and How Were Indian Investors Duped?
The ED’s provisional attachment of the ₹2,385 crore in crypto assets is directly linked to the massive Ponzi scheme operated by the OctaFX forex trading platform. The platform, which was operating in India without the necessary Reserve Bank of India (RBI) authorization, used a classic Ponzi model to lure investors with false promises of high returns on currency, commodity, and crypto trading.
Key details on the scale of the fraud:
- •Total Investor Loss: OctaFX systematically duped Indian investors of an estimated ₹1,875 crore between July 2022 and April 2023.
- •Estimated Total Proceeds of Crime: The company operated from 2019 to 2024, with total profits from its India operations estimated to exceed ₹5,000 crore—a majority of which was illicitly routed overseas.
- •The Modus Operandi: Funds were collected via UPI and local bank transfers, layered across multiple mule accounts and shell entities posing as legitimate e-commerce platforms, before being siphoned abroad under the guise of fake software imports and R&D services.
Mastermind Behind the OctaFX Ponzi Scam and International Arrest
The ED’s Mumbai Zonal Office is leading the transnational investigation, which recently resulted in a major breakthrough signaling global cooperation in combating financial cybercrime.
- •Alleged Mastermind: The individual identified as the primary orchestrator of the global network is Pavel Prozorov, a Russian national.
- •Arrest Location: Pavel Prozorov was arrested by local police authorities in Spain in coordination with Indian investigative agencies. The arrest was based on his involvement in cybercrimes affecting multiple countries.
- •International Network: The OctaFX operation utilized a complex, distributed global network to evade regulatory scrutiny, including entities handling marketing in the British Virgin Islands (BVI), servers and back-office operations in Spain, payment gateways in Estonia, and an entity in Cyprus serving as the holding company.
Total Value of Assets Seized in the OctaFX Case
The provisional attachment of the cryptocurrency assets significantly increases the total value of properties seized by the Enforcement Directorate in the OctaFX case. This demonstrates India’s successful application of the PMLA to trace and freeze assets across digital and physical domains.
The cumulative attachments include:
- •Cryptocurrency Holdings: ₹2,385 crore (latest provisional attachment, as of October 17, 2025).
- •Other Properties: Immovable properties and a luxury yacht previously attached in Spain, which were linked to the mastermind Pavel Prozorov.
- •Total Seized Assets: The total value of assets seized, attached, and frozen in connection with the OctaFX scam now exceeds ₹2,681 crore.
This comprehensive asset recovery action sets a strong precedent for using existing anti-money laundering laws to combat sophisticated, cross-border financial crimes involving digital assets.
Frequently Asked Questions (FAQs) on the OctaFX Crypto Scam
What section of the law did the ED use to seize the crypto assets?
The ED seized the ₹2,385 crore in crypto assets by issuing a provisional attachment order under the provisions of the Prevention of Money Laundering Act (PMLA), 2002. This legislation allows the agency to attach properties derived from or involved in money laundering, affirming that cryptocurrencies are viewed as ‘property’ under the existing anti-money laundering legal framework in India.
What specific methods did OctaFX use to launder the ₹5,000 crore proceeds of crime?
OctaFX executed a multi-layered money laundering scheme by routing investor funds through bank accounts of dummy Indian entities and then layering them across multiple mule accounts. These funds were ultimately transferred abroad under the pretext of paying for fake imports of software and R&D services to entities controlled by the mastermind in jurisdictions like Spain, Estonia, and the UAE, masking the actual illicit nature of the forex trading profits.
How does this OctaFX case affect the regulation of unauthorized forex and crypto platforms in India?
The successful provisional attachment of ₹2,385 crore in crypto and the arrest of Pavel Prozorov emphasize the ED’s resolve to prosecute unauthorized platforms like OctaFX aggressively. This case signals a definitive tightening of the regulatory environment, suggesting that the Indian government will actively use the PMLA to pursue promoters of illegal forex trading and investment schemes that involve cryptocurrencies or other digital assets, regardless of their international operations.