In a massive crackdown on alleged financial fraud in the online gaming sector, the Enforcement Directorate has frozen assets worth over Rs 523 crore belonging to two prominent gaming platforms. The action targets Pocket52 and WinZO Games Pvt Ltd for suspected money laundering, algorithmic manipulation, and violations of India's recent ban on real-money games.
Major Search Operations Across Multiple Cities
The ED's Bengaluru Zonal Office conducted extensive search operations between November 18-22, 2025 across Bengaluru, Gurgaon, and Delhi. This investigation comes months after the Centre implemented the Promotion and Regulation of Online Gaming Act on August 22, 2025, specifically banning real-money games to protect consumers from exploitation.
During the coordinated raids, officials seized numerous incriminating devices including mobile phones, laptops, and backed up substantial digital evidence. The probe revealed that both gaming platforms continued to hold significant customer funds despite the government ban, prompting the money laundering investigation under the Prevention of Money Laundering Act (PMLA), 2002.
Pocket52: Allegations of Game Manipulation and Fraud
According to ED officials, the investigation into Pocket52, operated by Nirdesa Networks Pvt Ltd, began following a First Information Report registered by Karnataka Police. The FIR alleged large-scale fraud involving manipulated game outcomes, player collusion, technical glitches, and withdrawal restrictions that affected numerous users.
One particularly severe case involved a complainant who reported losing over Rs 3 crore due to what authorities described as systemic cheating practices. The platform allegedly removed crucial features like transaction history and ignored responsible gaming practices while exploiting users without compensating them for their losses.
Despite the Union government's ban, Pocket52 was found holding more than Rs 30 crore in escrow accounts without processing customer refunds. The ED has frozen eight bank accounts serving as escrow accounts for payouts, containing approximately Rs 18.57 crore under Section 17(1A) of PMLA.
WinZO Games: International Operations and Algorithmic Deception
In a parallel operation, the ED froze proceeds of crime worth around Rs 505 crore possessed by WinZO Games in various forms including bank balances, bonds, fixed deposit receipts, and mutual funds. The investigation was triggered by multiple FIRs filed against WinZO on grounds of cheating, account blocking, impersonation, and misuse of Permanent Account Number cards.
Complainants alleged that their KYC details were misused, leading to substantial financial losses due to fraudulent activities. The ED's probe uncovered that WinZO operated real-money games in foreign countries including Brazil, USA, and Germany from India using the same platform as their Indian entity.
Even after the August 22 ban, the company continued holding Rs 43 crore belonging to gamers without processing refunds. More disturbingly, investigations revealed that WinZO engaged in unscrupulous practices by making customers play against algorithms and software without disclosure. Players believed they were competing against real humans in real-money games when in reality they were facing rigged systems.
The company also allegedly prevented or limited withdrawals of money held in customer wallets while generating proceeds of crime through bet amounts placed and lost by real customers through manipulated algorithms and software.
Broader Implications for Gaming Industry
This massive crackdown represents one of the most significant enforcement actions since the implementation of India's online gaming regulations. The frozen assets totaling Rs 523 crore highlight the scale of alleged financial irregularities in the sector and demonstrate the government's commitment to regulating the rapidly growing online gaming industry.
The cases against both Pocket52 and WinZO Games continue to develop as the Enforcement Directorate deepens its investigation into the money laundering aspects and examines the full extent of customer funds affected by these alleged fraudulent practices.
