In India: Garena Free Fire is accused of money laundering; BRL 44 million are blocked
Indian government has been chasing and banning companies that have Chinese connections.
By
Ronny Rolim
In India , where Garena Free Fire has been banned since February 2022 , the Government’s Directorate of Enforcement (ED) carried out, on September 27, 2022, searches of three facilities of “ Coda Payments India Private Limited ” (CPIPL), a payment site equivalent to Recarga Jogo here in Brazil , as part of an ongoing investigation against the battle royale under the Prevention of Money Laundering Act (PMLA), 2002. The law enforcement agency also froze all bank accounts and R$ 44 million reais were blocked .
Furthermore, the authorities claimed that the search uncovered details about CPIPL acting only as an agent for “ Coda Payments Singapore ” and remitting the money raised back to the parent company. The action takes place after several complaints were registered against Free Fire.
Garena Free Fire is investigated for money laundering in India
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ED carried out searches of 3 facilities belonging to “ Coda Payments India Pvt Ltd ” in connection with an ongoing investigation against the mobile game “ Garena Free Fire ” and the frozen bank account balance of $8.3 million USD, approx. $44 million reais.
Indian authorities allege that the CPIPL , which processed and collected payments for Garena Free Fire, Teen Patti Gold, Call of Duty and other games , resorted to inappropriate deductions. These deductions were mostly from unsuspecting kids using diamonds in the game.
The ED's statement also revealed that Garena Free Fire has no company or presence in India and is based in Singapore .
An ED statement on the money remitted read:
“To date, the amount collected by CPIPL is US$8.3, of which a portion of the amount was remitted outside India after withholding a certain percentage of the revenue for payment of tax and nominal profits.”
India is banning apps that have Chinese origins
In February 2022, India's Home Office recommended banning 54 Chinese mobile apps , including the popular game Garena Free Fire . Interestingly, Garena Free Fire is based in Singapore and the developer is not from China . The game was one of the most downloaded games in India last year and had occupied the space created by PUBG Mobile after it was also banned in September 2020 .
As it is Chinese, Tencent is responsible for India's actions against Garena Free Fire
Even though India has never said it is taking specific action against developers in a particular country, the vast majority of apps banned in the last two years originated in China . Chinese giant Tencent , which is a big investor in Shopee , is one of the few Chinese connections that Free Fire carries .
In addition to this operation that blocked around BRL 44 million from Garena Free Fire , the government agency carried out more than half a dozen investigations into technology companies this year, including those of Chinese smartphone providers Vivo, Oppo and Xiaomi , and seized more than $1 billion in cash that it said companies had evaded in fraudulent tax calculations.
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