The Enforcement Directorate (ED) on Sunday, 24 August arrested two men in Goa under the Prevention of Money Laundering Act (PMLA) for running a sprawling cyber-fraud operation that ensnared victims through fake 'digital arrests' and laundered the proceeds into foreign currency through licensed money changers. The accused were produced before the Special PMLA Court in Goa on Monday, 25 August, where the ED secured five days of custody until 29 August.

Who Was Arrested

The two accused have been identified as Fahim Moin Hussain Sayed and Naim Mueen Sayyed. Their arrests followed a complaint by a woman resident of North Goa, with the money laundering probe stemming from an FIR registered by the Cyber Crime Police Station, North Goa.

How the Fraud Worked

The victim suffered a loss of ₹2.60 crore after fraudsters placed her under continuous video call surveillance under the guise of a 'digital arrest' — a scheme in which callers impersonate law enforcement officials and coerce targets into transferring funds into fraudulent 'secret supervision accounts'. The coercion lasted from 21 May to 2 June this year.

Investigators found that the victim's money was routed within hours through an initial layer of dormant and newly opened bank accounts before being dispersed among more than 400 beneficiary accounts via transfers, cash withdrawals, self-cheques, and payment gateways. The trail then extended to an interconnected network of commodity, trading, travel, and foreign-exchange entities — including RBI-licensed full-fledged money changers.

Scale of the Operation

The network recorded banking transactions exceeding ₹27,850 crore, according to the ED. It deposited ₹2,904 crore in cash, of which ₹584.70 crore was deposited via 61,448 separate transactions at bulk note acceptance machines. The bank accounts linked to these dummy entities are connected to 163 FIRs and 330 complaints across 20 states and Union Territories, representing total reported victim losses of ₹417.49 crore.

Notably, in 101 of these complaints, funds from a single victim were routed to two or more entities within the same group during the same fraud — indicating the accounts functioned as a common pool rather than as independent businesses.

Shell Companies and Dummy Directors

The syndicate incorporated companies using the names of drivers and employees living in single-room tenements as dummy directors, while real operators controlled the entities externally. This layering strategy is consistent with patterns seen in several recent large-scale PMLA cases across India.

Searches and Seizures

The ED conducted searches across 20 premises in Mumbai and Goa on 17 July and 21 August, recovering ₹3.25 crore in cash and freezing bank balances exceeding ₹30 crore. Digital devices, books of account, records, and statutory registers were also seized and are currently under examination. The investigation is ongoing.