India's Enforcement Directorate (ED), a government agency that is responsible for probing financial crimes, has frozen assets worth 3.7 billion rupees ($46.4 million) at crypto exchange Vauld, it said in a statement Friday.
The statement confirmed authorities are interested in wallets held by Flipvolt – Vauld's legal entity in India – which contain "proceeds of crime derived from predatory lending practices" that it said were subsequently transferred abroad. The ED accused the company of aiding that process via lax checks.
In July, the crypto lender, which is backed by billionaire Peter Thiel, filed for bankruptcy protection from its Singaporean creditors. That came days after Vauld suspended withdrawals on its platform, following a market downturn that led to significant withdrawals.
Indian authorities have already frozen assets of exchange WazirX, and raided the properties of one of its directors. Indian media has also reported that the ED is probing at least 10 crypto exchanges for helping foreign firms launder money through crypto.
Vauld said it will provide an update when it has more information.
UPDATE (August 12, 2022, 12:55pm UTC): Amended headline and first two paragraphs to refer to Enforcement Directorate statement.