ED Files Supplementary Complaint Against 'Challenger King' in ₹157 Crore Mule Account Network Case

The Enforcement Directorate (ED) has cracked down heavily on a massive money laundering network, filing a third supplementary prosecution complaint against Mehmood Abdul Samad Bhagad, popularly known as 'Challenger King'. The complaint has been lodged under the Prevention of Money Laundering Act (PMLA), 2002, before the Special PMLA Court in Mumbai, centering around cyber fraud, illegal online gaming, betting, and the use of mule bank accounts.

The Genesis of the ₹157 Crore Mule Account Scam

The investigation initially stemmed from an FIR registered by the Malegaon Camp Police Station in Nashik, which was later re-registered by the Maharashtra Anti-Terrorism Squad (ATS). The case came to the limelight when investigative agencies detected massive deposits exceeding ₹100 crore in newly opened bank accounts at the Nashik Merchants Co-operative Bank (NAMCO Bank) in Malegaon.

According to ED's findings, shell companies were incorporated and bank accounts were opened under dummy names at the behest of Mehmood Bhagad. A total of over ₹157 crore was routed through these suspicious accounts. This illicit money was further layered through shell company accounts controlled by Bhagad and eventually funneled out through hawala channels.

Crypto USDT and Hawala Operations

The federal agency uncovered the modus operandi of the syndicate, revealing that Bhagad and his associates used USDT (a cryptocurrency) trading to facilitate money transfers. Cyber fraudsters and illegal betting operators allegedly deposited Indian Rupees into the mule accounts managed by Bhagad, in exchange for USDT, thereby obfuscating the trail of proceeds of crime.

During the course of the investigation, ED conducted searches across Surat, Malegaon, Ahmedabad, and Mumbai, seizing incriminating documents. The agency has previously seized approximately ₹15 crore in cash, frozen about ₹34 crore in various bank accounts, and provisionally attached movable and immovable properties valued at ₹95 lakh.

Crackdown and Arrests

To date, six individuals have been arrested in connection with this high-profile financial scam. The ED has previously filed one main prosecution complaint and two supplementary complaints, which have already been taken cognizance of by the Special PMLA Court. The filing of this third supplementary complaint marks another significant step in dismantling the sprawling financial crime network.