In this case study, we examine enforcement actions, timelines, and likely FEMA compliance issues across several digital gaming platforms.
📌 1) Gameskraft:
The Enforcement Directorate’s public release says the case arose from alleged cheating of online real-money rummy players, followed by layering through dividends, buy-backs, mutual funds, bonds, convertible notes, equity, movable assets, and high-value items. It also says the agency used Section 17 of the PMLA for searches and relied on multiple FIRs for scheduled offences.
Timeline:
- Mid-2023: Allegations and initial complaints about cheating and irregularities surfaced in reporting.
- Late 2023 to early 2024: FIRs filed and preliminary investigations by local police and other agencies recorded.
- 2024 (search phase): ED invoked Section 17 of the PMLA and carried out searches linked to alleged money laundering and layering.
- 2025: Proceedings and asset-tracing activity continued, with regulatory scrutiny on corporate and financial flows.
For FEMA, the likely compliance provisions are:
- Section 3 of FEMA, if any prohibited or improper foreign exchange transaction or indirect value transfer was involved.
- Section 4 of FEMA, if foreign exchange or foreign assets were held or used contrary to the law.
- Section 6(3) of FEMA and the relevant Foreign Exchange Management (Non-Debt Instruments) Rules, 2019, if foreign investment, share issues, buy-backs, or downstream investment were involved.
- Foreign Exchange Management regulations under the NDI framework, for pricing, reporting, and investor eligibility issues.
- FEMA reporting regulations such as FC-GPR, FC-TRS, and downstream reporting requirements, if shares, convertibles, or non-resident holdings were part of the structure.
📌 2) Foreign-registered gaming websites:
The ED’s 2023 FEMA search action targeted foreign-registered gaming websites linked to Indian bank accounts in proxy names. Reports refer to operations routed through jurisdictions such as Curacao, Malta, and Cyprus. The reporting suggested suspected remittances and collections through Indian accounts despite offshore registration.
Timeline:
- 2022–early 2023: Media and compliance observers flagged foreign-registered gaming platforms servicing Indian users.
- Mid-2023: ED operations and FEMA searches focused on foreign-registered sites connected to Indian bank accounts and proxy arrangements.
- Late 2023: Follow-up investigations probed payment routing, account ownership, and offshore jurisdictions involved.
For FEMA, the key sections and regulations are:
- Section 3(a) and 3(b) of FEMA, for unauthorized dealing in foreign exchange or payments outside the authorized framework.
- Section 5 of FEMA, if foreign exchange was not used for a permitted current account purpose.
- Section 6 of FEMA, if capital account transactions or offshore structures were used improperly.
- Foreign Exchange Management (Current Account Transactions) Rules, 2000, if remittances were made for purposes not permitted.
- Reserve Bank liberalised remittance and payment-routing rules, if Indian residents funded offshore gaming activity or payment flows were structured through proxies.
📌 3) Coda Payments and Garena Free Fire:
Public reporting said the ED froze about ₹68 crore after alleging unauthorized payments and remittances linked to mobile gaming operations, with some funds allegedly transferred to Singapore. The core concern was the movement of money through Indian accounts and outward transfer linked to the business model.
Timeline:
- 2021–2022: Coda Payments and related payment processors increased collections from app-based gaming across India and other markets.
- 2023: Regulatory attention intensified on cross-border payment flows from gaming apps; reporting noted transfers to Singapore-linked entities.
- 2024: ED froze roughly ₹68 crore in connection with alleged unauthorized remittances and payment routing tied to mobile gaming operations.
For FEMA, the likely provisions are:
- Section 3 for unauthorized foreign exchange dealing.
- Section 4 if foreign exchange or overseas assets were held contrary to law.
- Section 5 for current account remittance issues.
- Section 6 and the relevant capital account transaction rules, if proceeds were moved offshore as part of investment, settlement, or structuring.
- RBI payment and remittance directions, if Indian collection accounts were used in a way inconsistent with the permitted gaming or payment flow.
📌 4) E-nuggets:
Reports said the ED traced more than 300 accounts and seized or froze assets, including Bitcoins, in connection with an online gaming and app-based fraud and laundering probe. The foreign-asset angle makes this matter especially relevant for both PMLA and FEMA analysis.
Timeline:
- 2022: Complaints and suspicious transaction reports prompted scrutiny of app-based gaming collections.
- 2023–2024: ED and enforcement actions traced dozens to hundreds of accounts linked to the app ecosystem.
- 2024–2025: Seizures and asset freezes included cryptocurrencies and other assets; investigations probed cross-border flows and virtual asset usage.
For FEMA, the possible sections are:
- Section 3 and Section 4, if crypto-linked or foreign-value transactions were routed outside permitted channels.
- Section 5, if outward remittances or transfers were made without a permitted purpose.
- Section 6, if the transactions had a capital account character or involved foreign asset holding.
- RBI and FEMA directions on virtual digital asset-linked payments, where applicable through banking or remittance channels.
📌 5) Probo:
The ED reportedly attached assets worth ₹117.41 crore in December 2025, after an earlier freeze of ₹284.5 crore, in a case described as gambling in the guise of gaming. The FEMA relevance comes from how user funds were collected, pooled, and moved, especially if payment flows crossed borders or were structured through intermediaries.
Timeline:
- 2024: Allegations and regulatory interest in platforms operating real-money games grew.
- December 2025: ED attached assets totaling ₹117.41 crore, following an earlier freeze of approximately ₹284.5 crore.
- 2025 onward: Ongoing legal and enforcement proceedings examined the business model, payment flows, and any cross-border components.
For FEMA, the likely provisions are:
- Section 3, if unpermitted foreign exchange dealing or indirect routing occurred.
- Section 5, if funds were sent abroad without a permitted current account purpose.
- Section 6, if any cross-border structuring, foreign investor flows, or offshore settlement was involved.
- Current Account Transactions Rules and RBI payment channel requirements, if the business model depended on collection or remittance patterns inconsistent with permissible use.
📌 6) WinZO:
Reports said the ED charged the company and promoters, alleging rigged real-money games and laundering through overseas entities. That makes this a classic overlap case where offshore structures, foreign payments, and gaming revenue channels may all be under review.
Timeline:
- 2021–2022: WinZO grew as a platform offering skill and real-money games.
- 2023: Media reports and enforcement interest increased around alleged game-rigging and fund movement to overseas entities.
- 2024–2025: ED registered matters and pursued actions against the company and promoters, focusing on alleged laundering through offshore structures.
For FEMA, the likely provisions are:
- Section 3, for any unauthorized forex dealing or value transfer.
- Section 4, if foreign assets or balances were held improperly.
- Section 6, for any outbound investment, overseas entity, or cross-border settlement issue.
- Foreign investment and overseas investment rules, if promoter-related offshore entities or foreign subsidiaries were used in the flow of funds.
