The adjudicating authority of the Enforcement Directorate recently imposed a hefty fine of Rs 2,146 crore on an NBFC for allegedly running loan app with links to some Chinese companies. PC Financial Services has been fined over violations of FEMA regulations.
The NBFC has alleged connection with some Norwegian and Chinese entities, as per the probe agency. This is the first time when an Indian non-banking financial company has been slapped with a fine for running a loan app.
According to the FEMA probe, Chinese owners had ‘overall control’ of the NBFC. The money-lending business in India was carried via mobile app called “CashBean”.
The officials also said that nearly Rs 430 crore were sent by PCFS to the foreign entities in the name of ‘Import of Software Licenses and Services’. The agency said that this was “found to be bogus.”
On October 7, the probe concluded with the authority seizing PCFS’s India properties worth Rs 252.36 crore.
“Adjudication proceedings have been completed after following due process of law. Upon careful examination of the alleged violations levelled against the Noticees vis-à-vis their written replies and submissions made during personal hearings, it has been found that the alleged FEMA violations have been clearly proved,” the adjudicating authority of the Enforcement Directorate said in the statement.