The Enforcement Directorate (ED) has arrested Saumya Singh Rathore and Paavan Nanda, the founders of the online gaming platform WinZO, on charges of money laundering. The arrests, made in Bengaluru on Wednesday, follow questioning at the ED's zonal office. A local court has remanded the duo to one-day custody. They are expected to appear in court again for a more detailed hearing.
The ED had previously raided WinZO's premises and those of another online gaming company, Gamezkraft, along with their promoters, under the Prevention of Money Laundering Act (PMLA). The agency accuses WinZO of engaging in criminal activities and unscrupulous practices, alleging that customers were unknowingly playing against algorithms in real-money games. The ED claims WinZO operated real-money games in countries like Brazil, the US, and Germany from India.
According to the ED, WinZO continues to hold approximately ₹43 crore of gamers' funds that should have been refunded following the government's ban on real-money gaming effective August 22, 2025. The ED has frozen bonds, fixed deposits, and mutual funds worth ₹505 crore "possessed" by WinZO Games under the PMLA. The agency also alleges that WinZO has parked USD 55 million in a US bank account belonging to a shell company, while managing all operations and bank accounts from India. Similar allegations have been made against Gamezkraft.
Paavan Nanda, 38, is an entrepreneur and co-founder of WinZO, a real-money and social gaming platform in India. Before WinZO, he helped build Zostel and ZO Rooms. He holds a Bachelor's in Engineering from Netaji Subhas Institute of Technology and an MBA from the Indian Institute of Management, Calcutta. The combined net worth of Nanda and Rathore is reportedly ₹962 crore.
WinZO released its audited financial results for the fiscal year ending March 31, 2024, reporting revenue from operations rising to ₹1,055 crore, a 70% increase from ₹619 crore, and adjusted profit after tax reaching ₹315 crore, a 151% increase from ₹125 crore.
The ED's investigation suggests that WinZO facilitated unlawful financial transactions under the guise of online gaming, routing funds through digital wallets, shell entities, and offshore accounts. The probe reportedly uncovered discrepancies in financial reporting and transactions that did not match declared gaming revenues. Authorities seized mobile phones, laptops, and voluminous data backups from company premises during the operations. Eight bank accounts with balances of Rs 18.57 crore have been frozen.
In response to the charges, a WinZO spokesperson stated that fairness and transparency are core to the platform's design and operations. The spokesperson asserted the company's commitment to protecting users and ensuring a secure, trustworthy experience, while complying with applicable laws.
The arrests mark a significant escalation in the government's scrutiny of India's online gaming industry, which has faced increased scrutiny over alleged tax evasion, dubious payment flows, and compliance failures. Both WinZO and Gameskraft have previously faced regulatory challenges, including GST disputes and questions over the legality of their gaming formats. The ED is expected to summon additional executives and financial partners as the investigation continues. The arrests have raised concerns about tighter regulations and increased enforcement action in the real-money gaming sector.
