Paytm Fined Rs 5.45 Crore For Alleged Money Laundering

Financial Intelligence Unit India, (FIU-IND) a Department of the Revenue, Government of India, today imposed a fine of Rs 5.49 crore to the finetech firm Paytm Payment bank for the alleged violation of the obligations under the Prevention of Money Laundering Act (PMLA), according to a press release by the Finance ministry.

The fine followed the recent order by the Reserve Bank of India to the Paytm Payment Bank to end accepting fresh deposits in its accounts or wallets from March 15. However, the latest blow to the firm with a heavy fine came after the FIU-IND reviewed the Paytm Payments bank based on the specific information from the law-enforcement agencies alleging illegal acts.

The release said that the review saw the firm engaging in several illegal acts, including organising and facilitating online gambling. It also noted that the money generated from illegal operations was channelled through bank accounts with the Paytm Payment Bank. The release said that it had issued a compliance show cause notice to the bank for its violations citing the rules.

“After considering the written and oral submissions of the Paytm Payments Bank Ltd, Director, FIU-IND, based on the voluminous material available on record, found that the charges against Paytm were substantiated. Consequently, vide order dated March 1st, 2024 in the exercise of his powers under Section 13, PMLA, it was found to be appropriate to impose a penalty of Rs. 5,49,00,000,” the release added.

A Paytm payment Bank spokesperson said that the penalty is related to the issues within a particular business segment and that was stopped two years ago. After that, the Bank has enhanced its monitoring systems and reporting mechanisms to the Financial Intelligence Unit (FIU), as per the firm’s spokesperson.