India’s Financial Intelligence Unit has issued non-compliance notices to 15 offshore crypto platforms, alleging they served users in the country without registering under India’s anti-money laundering framework.

The action was taken under Section 13 of the Prevention of Money Laundering Act. India’s rules, introduced for crypto businesses in March 2023, require any platform targeting Indian customers to register with the FIU, verify users, keep records and report suspicious activity, even if the company has no office in India.

Platforms named by the FIU

The FIU-IND said the notices were sent to 15 virtual digital asset service providers described as small and medium-sized operators. The official list names Weex, Blofin, Rezorex, Bitunix, DigiFinex, Toobit, XT.com, Latoken, WOO X, Pionex, ChangeNow, SimpleSwap, Fixedfloat, WhiteBIT and Guardarian as alleged violators.

According to the agency, the issue is not their location but whether they were serving Indian customers without complying with registration requirements. The rules apply to platforms offering services to Indians regardless of whether they maintain a physical presence in the country.

What India’s AML rules require

India brought crypto platforms, also described as virtual digital asset service providers, under the same anti-money laundering obligations as banks in March 2023. That change made registration with the FIU-IND mandatory for platforms serving Indian users.

Once registered, platforms are required to carry out customer verification, maintain prescribed records and file reports on suspicious transactions. The latest notices indicate the FIU believes the named offshore firms were operating in scope of those obligations without meeting them.

Why regulators are focusing on offshore services

The enforcement step follows reports that some Indians have been using overseas crypto platforms to convert stablecoins into gift cards, which were then used to fund daily expenses back home. The source article presented that activity as part of the backdrop to the regulator’s latest move.

More broadly, the action signals continued scrutiny of cross-border crypto services that can reach Indian users online without setting up locally. By issuing notices to offshore firms, the FIU is reinforcing its position that compliance duties are tied to serving Indian customers, not to where a platform is incorporated or based.

Warning to users and what comes next

Alongside the notices, the FIU cautioned Indians about risks linked to crypto products and non-fungible tokens. The warning accompanied the agency’s announcement but did not add further detail on possible follow-up measures against the 15 platforms.

The confirmed next step is that the notices have been issued under the anti-money laundering law. The article does not say how the named firms responded, whether any penalties have already been imposed, or whether additional enforcement action will follow.

Source: www.coindesk.com