WazirX under ED lens for alleged money laundering

NEW DELHI: The Enforcement Directorate investigates WazirX under Foreign Exchange Management Act, 1999 (FEMA). Meanwhile, New York’s financial regulator slaps a fine of $30 million on Robinhood for failing to follow anti-money laundering guidelines and cyber security rules.

As per a written reply by Pankaj Chaudhary, Minister of State for Finance said in Rajya Sabha, the Directorate of Enforcement (ED) is investigating two cases against WazirX under the FEMA.

“In one of the cases, investigation done so far has revealed that one Indian Crypto-exchange platform, WazirX, operated by Zanmai Labs Private Limited in India was using the walled infrastructure of Cayman Island based exchange BINANCE. Further it has been found that all crypto transactions between these 2 exchanges were not even being recorded on the blockchains and were thus cloaked in mystery,” Chaudary has said. Meanwhile, the Superintendent of the Department of Financial Services (DFS) of New York, Adrienne Harris imposed a $30 million penalty on Robinhood Crypto, LLC (RHC) for failing to adhere to New York State rules regarding bank secrecy act/anti-money laundering (BSA/AML) obligations and cybersecurity laws and regulations.

Superintendent Harris said in a release, “As its business grew, Robinhood Crypto failed to invest the proper resources and attention to develop and maintain a culture of compliance—a failure that resulted in significant violations of the Department’s anti-money laundering and cybersecurity regulations.”

In yet another major cryptocurrency hack, the popular blockchain Solana on Wednesday reported that an unknown bad actor has drained funds from 7,767 wallets on the Solana Network.

However, Blockchain security firm SlowMist claimed more than 8,000 wallets had been drained worth around $8 million. Solana is a high-performance Blockchain supporting builders around the world creating crypto apps that scale today.

The attack has affected “hot” wallets which are always connected to the internet, allowing people to store and send tokens easily.

“Engineers from multiple ecosystems, with the help of several security firms, are investigating drained wallets on Solana. There is no evidence hardware wallets are impacted,” said Solana. The exploit has affected several wallets, including Slope and Phantom. “There’s no evidence hardware wallets have been impacted -- and users are strongly encouraged to use hardware wallets. Do not reuse your seed phrase on a hardware wallet - create a new seed phrase,” Solana informed. “Wallets drained should be treated as compromised, and abandoned,” it added.