GST intelligence in Hyderabad has apprehended Pankaj Kumar, the founder and director of Adsum Advisory Service Pvt Ltd, in connection with an organized syndicate valued at Rs 13,000 crore, which was engaged in running illegal online gaming websites with the support of associated fintech companies.
The Directorate General of GST Intelligence, Hyderabad Zonal Unit, highlighted that this arrest marks a significant breakthrough in the ongoing investigation into online gaming activities. Adsum Advisory Service specializes in fraud detection and digital KYC services for customers.
The investigation revealed the existence of a well-structured syndicate worth Rs 13,000 crore that operated illicit online gaming platforms in collaboration with related fintech entities, including payment aggregators, gateways, and technology service providers. Pankaj Kumar, identified as one of the key figures, was involved in fraudulent KYC verification processes for merchants and shell entities on behalf of RBI-regulated entities like Payment Gateways and Banking as Payment Aggregator (BAPA).
As a director overseeing the KYC verification procedures, Pankaj Kumar allegedly neglected to establish risk profiles for customers based on ownership and control structures. He facilitated the integration of shell entities for UPI transactions essential for the movement of funds in online gaming operations, and was among the beneficiaries of the illegal proceeds generated by the gaming syndicate.
The online gaming industry in India is estimated to reach a valuation of about USD 23 billion (two lakh crores) by 2025. In response, DGGI, Hyderabad, has initiated a robust crackdown on online gaming syndicates, taking actions against associated fintech companies, freezing bank accounts amounting to Rs 100 crores, and apprehending key individuals. The investigation is ongoing.
