OctaFX Crackdown Deepens: ED Freezes ₹2,385 Crore in Crypto, Mastermind Arrested in Spain Amid Expanding Global Fraud Probe

India’s Enforcement Directorate (ED) has escalated its action against the offshore forex platform OctaFX, freezing cryptocurrencies worth ₹2,385 crore (US$271 million) and securing the arrest of the platform’s alleged mastermind, Pavel Prozorov, in Spain. The move marks one of the largest financial crime crackdowns involving digital assets in India, revealing a vast web of cross-border laundering and deception disguised under the banner of forex trading.

According to ED investigators, OctaFX systematically defrauded Indian investors through unauthorized forex schemes, luring users with promises of high, consistent returns and leveraging aggressive marketing campaigns targeted at retail traders. The probe found that between July 2022 and April 2023, investors were collectively misled into transferring approximately ₹1,875 crore, with unlawful profits of around ₹800 crore funneled out of India via complex payment layers.

The ED stated that these transfers often involved dummy entities and unauthorized payment aggregators, disguising remittances as software or R&D imports. Much of the money was allegedly recycled into India as foreign direct investment, completing a full-circle laundering process that helped maintain a veneer of legitimacy.

Authorities said total illicit profits from India are estimated to exceed ₹5,000 crore (US$568 million) over the platform’s years of operation. In addition to the seized crypto assets, the ED has attached 19 properties and a luxury yacht in Spain linked to Prozorov. Two charge sheets have been filed against 55 individuals and entities connected to the network.

The agency also accused OctaFX of manipulating trading data and execution, including falsified candlestick charts and deliberate slippage to ensure investor losses—features consistent with the Ponzi-like operations previously reported. The company’s Introducing Broker (IB) scheme, which rewarded promoters based on client activity, further expanded its reach across the retail market.

OctaFX, in response, has denied any wrongdoing, asserting that it operates in compliance with local laws in the jurisdictions where its entities are registered. The broker claims its data feeds are sourced from verified market providers and that the arrested individual’s activities are unrelated to its global brand operations.

The case underscores how unregulated offshore brokerages continue to exploit jurisdictional loopholes, using multi-entity corporate webs to target retail traders in emerging markets. It also reinforces the growing vigilance of Indian authorities toward crypto-linked money laundering and cross-border financial fraud.

Earlier this year, widespread investor complaints and withdrawal issues involving OctaFX had already raised red flags by Brokersview.

As enforcement actions intensify, OctaFX’s ongoing case serves as a potent reminder of how fraudulent brokerages can weaponize legitimacy and technology to perpetrate large-scale deception across borders — and how regulators are beginning to close in.

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