The Financial Intelligence Unit of India (FIU-IND) has issued notices to 25 offshore virtual digital asset (VDA) service providers for allegedly violating India’s anti-money laundering (AML) laws, the Finance Ministry confirmed on Thursday. The notices were served under Section 13 of the Prevention of Money Laundering Act (PMLA), which empowers authorities to investigate company records, verify customer details, and demand reports on suspicious transactions. Companies found in breach could face fines of up to Rs 1 lakh per violation.
Among the firms receiving notices are CoinW (Singapore), BTCC (UK), Changelly (Hong Kong), Paxful (US), Huione (Cambodia), CEX.IO (US/UK), LBank (British Virgin Islands), PrimeXBT (Saint Lucia), Coinex (Hong Kong), Remitano (Singapore), Poloniex (Boston), BitMex (Seychelles), and LCX (Liechtenstein).
In addition, FIU-IND has issued separate notices under the Information Technology Act, 2000, instructing the removal of apps and websites operating in India without proper PMLA registration.
FIU-India, established in 2004, is the principal agency for collecting and analyzing information on suspicious financial transactions. While 50 VDA service providers have registered with FIU-IND, multiple offshore firms continue operations in India without registration, placing them outside the AML and counter-financing of terrorism (CFT) framework.
The government emphasized that all VDA providers serving Indian users, whether domestic or offshore, must register with FIU-IND and comply with PMLA rules. The regulations cover activities including crypto-to-fiat exchanges, virtual asset transfers, digital asset safekeeping, and other services that grant control over virtual assets. Compliance is mandatory even without a physical presence in India.
The Finance Ministry also cautioned investors that cryptocurrencies and non-fungible tokens (NFTs) remain unregulated in India and carry high risks. Users are reminded that there is no regulatory protection for losses incurred in such transactions.
This step signals the government’s increasing focus on regulating the rapidly expanding digital asset sector and ensuring AML adherence among domestic and offshore operators serving Indian customers.
