Financial Intelligence Unit Issues Notice To 15 Crypto Service Providers, Asks To Take Down Urls

Financial Intelligence Unit-India (FIU-IND) has issued notice to 15 Virtual Digital Assets Service providers for non-compliance with anti-money laundering law and asked the entities to take down their application/URLs for public access.

Virtual Digital Assets Service Providers (VDA SPs) operating in India, whether offshore or onshore, and engaged in activities like exchange of virtual digital assets and fiat currencies, and transfer of virtual digital assets, are required to be registered with FIU-IND as reporting entity and comply with Prevention of Money Laundering Act (PMLA).

These obligations are activity-based and are not contingent on physical presence of the entity in India.

The finance ministry said as part of compliance action against non-compliant entities, FIU-IND has issued notices to 15 VDA SPs for non-compliance under Section 13 of the PMLA.

These entities include Weex International Exchange, BLF Global, Bitunix LLC, DigiFinex Ltd and FinSeven CZ.

"The Director, FIU-IND ... has also issued notices with respect to the ... entities to take down the application/URLs for public access which have been found to be operating illegally without complying with the relevant provisions of the PMLA in India," the ministry said.

VDA SPs were brought under the ambit of Anti-Money Laundering/Countering the Financing of Terrorism (AML/CFT) framework under the PMLA provisions in March 2023.

For investor awareness, the ministry also reiterated that "Crypto products and NFTs are unregulated and can be highly risky. There may be no regulatory recourse for any loss from such transactions."