Law Enforcement Directorate Seizes Rs 107 Crore From Chinese Loan Application Company | Hyderabad News
PCFS operates a “Cashbean” instant mobile loan application and is accused of sending money overseas for non-existent software and marketing services. ED is investigating several NBFCs for money laundering via instant micro-loans on mobile applications. “PCFS is a 100% subsidiary (WOS) of Oplay Digital Services, SA de CV, Mexico, which is a WOS of TenspotPesa Limited, Hong Kong, owned by Opera Limited (Cayman Islands) and Wisdom Connection | Holding Inc (Cayman Islands). The ultimate owner is Zhou Yahui, a Chinese. The original Indian company PCFS was incorporated in 1995, obtained the NBFC license in 2002 and after the approval of RBI in 2018, the ownership was transferred to a company controlled by China, ”said the managing director.
While the foreign parent companies of PCFS brought in 173 crore rupees as FDI for lending activities, the company quickly made overseas remittances of 429 crore rupees for bogus software services received from related foreign companies.
“The PCFS also showed high domestic spending of Rs 941 crore. Most of its overseas payments have been made to related / Chinese owned companies that run the Opera group. The Chinese have chosen foreign service providers and prices, ”the ED said.
According to ED officials, all PCFS payments were ordered by Country Head Zhang Hong, who reports directly to Zhou. PCFS sent Rs 429 crore to 13 foreign companies in Hong Kong, China, Taiwan, United States and Singapore as payment of the license fee for the Cashbean mobile app (Rs 245 crore / year), software technical costs (approximately Rs 110 crore) and online marketing and advertising costs (approximately Rs 66 Crore).
“All of these services are available in India for a fraction of the cost incurred by PCFS. All of its customers are in India but huge payments have been made abroad without proof of receipt. During the same period, the PCFS also recorded domestic expenditure of a similar amount under the same headings. PCFS management did not provide any justification for these expenses and admitted that all remittances were made to transfer money out of India to accounts of group companies controlled by the Chinese promoter ”, said the general manager.