The bank balances valued at 192.35 crore have been attached by the Enforcement Directorate (ED) after carrying out massive searches in an accounting firm suspected of carrying out financial control activities on behalf of an online gaming company WinZO. This move will be an additional setback to India booming real-money gaming industry where the authorities are tightening their belt to curb alleged money laundering and tax evasion.
Scope of the ED Operation
On December 30, 2025, ED raided 15 offices and homes of partners of the accounting firm, which offered bookkeeping and compliance services to WinZO entities, in Delhi, Mumbai, and Pune. In the operations, incriminating digital data was discovered and this included transaction ledgers that showed money channeled using 100 or more shell bank accounts to conceal sources and avoid paying tax.
The frozen funds comprise current account, fixed deposit and mutual fund investments of the firm and its associates. On its part, ED used provisions of the Prevention of Money Laundering Act (PMLA) 2002 arguing that the money is proceeds of crime (result of illegal gambling) through pretence in the form of skill based contests.
WinZO Business Model In Question.
WinZO is a skill-based gaming platform established in 2018 by Paavan Nanda and Saumya Singh Rathore and focuses on games, such as ludo, carrom, and fantasy sport, with real-money entries. It boasts of more than 150mm users and gross gaming revenue (GGR) of Rs 2,500 crore in annual gross gaming revenues (GGR). But, ED claims that a considerable percentage of the transactions was based on betting on chances, which is outlawed in most states, and the revenues were transferred to offshore accounts using hawala networks or cryptocurrency wallets.
The accounting company allegedly made falsified statements in which it prepared falsified ledgers to reflect legitimate gains in skill games and reported less taxable income. There were also digital footprints of kickbacks that had been made to platform executives to ignore compliance red flags.
Regulatory Environment of Indian Gaming.
The market of online gaming in India has grown to 5 billion dollars after the pandemic, and it is not regulation-heavy. The 2023 IT Rules distinguish between skill (legal) and chance (gambling), but some states enforce the ban, such as Tamil Nadu and Telangana, whereas others tax GGR at 28%. The investigation carried out by ED is in line with other investigations against Dream11 and MPL where the platforms forbid GST payments of more than 20,000 crore each.
WinZO has challenged these classifications and has won desirable high court decisions that asserted that it was skillful. The company made a declaration that it did not violate PMLA, it was fully complying with GST (paid Rs 1,200 crore in FY24), and that it would appeal the attachment.
Business and Operations Aftermath.
The freeze will interfere with the cash flows of WinZO to pay out its users and to operate, which can involve 10 million users on a daily active basis. The accounting partners are under personal financial pressure, as the assets are provisionally confiscated, until the hearings of the adjudication tribunal. Other venture capital firms such as Tiger global and Courtside Ventures that invested 100 million dollars in WinZO are re-evaluating the risks in the sector where the self-regulatory agency of MeitY is mandatory.
To the auditors and CAs, this is a caution: they can be liable to PMLA because of the lack of due diligence when dealing with high risk clients such as the gaming apps.
Broader Campaign by ED in digital illegitimate flows.
The 2025 raids by ED have retrieved more than 5,000 crore in gaming related attachments, which take advantage of UPI and wallets to transfer funds across countries. It may typically be Chinese-owned apps returning money to parent companies in the form of so-called platform fees. This WinZO-linked probe represents the move of ED into fintech gatekeepers.
Direction and Industry Spillover.
The money in the attached is frozen until the PMLA ad-judicating authority makes its decision, which may take months. WinZO can also request the courts to grant interim relief, with reference to the disruption of business. In the meantime, platforms make KYC upgrades and transparent reporting go fast to avert raids.
This is of concern to the content creators of finance in Ambala, Haryana, where gaming has a dual advantage; innovation potential and regulatory minefields. India balances between growth and oversight and as the saga of WinZO shows, there is much at stake on the economic frontier of digital India.
