Paytm Clarifies No New ED Notice Amid Share Price Dip

In an official release, Paytm clarified that reports published by a section of media on January 24, 2025 were "factually incorrect and misleading." The firm said it did not receive information from the concerned media houses that it was making such reports with regard to seeking verification before publishing it.

Paytm, the digital payments giant, has denied receiving any new notices or queries from the Enforcement Directorate (ED) concerning recent media reports alleging its involvement in a cryptocurrency scam.

In an official release, Paytm clarified that reports published by a section of media on January 24, 2025 were "factually incorrect and misleading." The firm said it did not receive information from the concerned media houses that it was making such reports with regard to seeking verification before publishing it.

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The company referred to its previous letter dated September 4, 2022, and reiterated that the ED probe was related to some third-party merchants for whom the company provided payment processing solutions. Paytm stated that these merchants operate independently and are not part of its corporate structure. The company affirmed its full cooperation with authorities in the past and compliance with all directives.

Paytm Assures Investors Amid Stock Price Drop

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Its shares fell over 5 per cent on Friday following reports of alleged ED investigation into its operations linking it to HPZ Token, a cryptocurrency scam. The share price of the company had also dropped by a maximum of 8.84 per cent before going down to the lowest at Rs 773.90 on BSE.

It implored its investors and other stakeholders to not rely on unverified reports in the media and promised to inform them of any material developments in compliance with the provisions of SEBI (Listing Obligations and Disclosure Requirements) Regulations, 2015.

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The Cryptocurrency Scam

Reports say that in virtual accounts through eight payment gateways, of which Razorpay, PayU, Easebuzz, and Paytm are cited, the ED has frozen an amount of almost Rs 500 crore.

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Apparently, the alleged scam by the ten Chinese nationals collected more than Rs 2,200 crores from across 20 states through the mobile app HPZ Token.

The scam was fraudulent, as they were luring people to invest in cryptocurrency mining schemes, even Bitcoin. It was found that the culprits had opened a chain of shell companies spread across several states and used more than 200 bank accounts to launder money. Some of the notable personalities associated with the scam are:

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Delhi: More than 50 companies with 84 bank accounts.
Karnataka: 26 companies with 37 bank accounts.
Other States: Uttar Pradesh, Maharashtra, Gujarat, Tamil Nadu, and West Bengal.

Money Freezed by ED

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The ED froze funds across multiple payment platforms as follows:
PayU: Rs 130 crore
Easebuzz: Rs 33.4 crore
Razorpay: Rs 18 crore
CashFree: Rs 10.6 crore
Paytm: Rs 2.8 crore

Other such platforms like WunderBaked, AgreePay, and SpeedPay have also been said to have been involved in the escrowed financial transaction with the scam.

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Although Paytm claims that it has not received any new orders from the ED, the ongoing third-party merchant investigation continues to reflect negatively on the company's stock performance and market perception.

The corporation needs to stick to its stance of transparency and continued regulatory compliance as the situation unfolds.

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Read also| Union Budget 2025 Likely to Revise Income Tax Slabs, Suggests Nomura Report

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