• The Enforcement Directorate (ED) conducted raids across 11 locations in Bengaluru, Delhi, and Gurugram on major gaming firms, including Gameskraft and WinZO.
• The probe is focused on money laundering, cheating, and suspected algorithm manipulation following FIRs filed by individual users.
• Investigators are examining the role of gaming federations in certifying bank accounts and checking Random Number Generator (RNG) certification for irregularities.
• Promoters are suspected of holding crypto wallets, which officials believe may indicate laundering activities linked to the businesses.
• The raids intensify the crackdown shortly after the Promotion and Regulation of Online Gaming Act (PROGA) 2025 imposed a blanket ban on money-based games (effective 1 October).

ED Raids Gameskraft and WinZO for Second Day

The Enforcement Directorate (ED), India’s economic intelligence agency, intensified its crackdown on the online gaming sector on Wednesday with continued raids on major platforms Gameskraft and WinZO. The searches, which began on Tuesday, covered 11 premises across Bengaluru, Delhi, and Gurugram, including corporate offices and the residences of CEOs, COOs, and CFOs.

Officials are investigating serious allegations of money laundering, financial irregularities, and cheating linked to the companies’ financial structures and technical certification processes. The raids come just weeks after the central government enforced the Promotion and Regulation of Online Gaming Act (PROGA) 2025, which imposes a nationwide prohibition on online money-based games. Both Gameskraft and WinZO have already suspended their real-money gaming operations in India following the implementation of PROGA.

Focus on Federations, Algorithms, and Crypto Links

The ED’s investigation has focused on multiple areas of alleged non-compliance and financial crime:

• Federation Certification: Investigators questioned employees and senior executives about the role of gaming federations in issuing certificates that companies used for opening bank accounts. Authorities are checking whether these bodies helped create structures that enabled financial irregularities.
• Algorithm Manipulation: The probe follows FIRs (First Information Reports) filed by individuals who allege that the gaming platforms manipulated game outcomes and algorithms to put players at a disadvantage.
• Crypto Links: Officers found evidence that promoters hold crypto wallets, leading to suspicions that cryptocurrencies were used to facilitate money laundering activities.

The action against Gameskraft also ties into previous internal issues, including a complaint filed by the company alleging its former Chief Financial Officer Ramesh Prabhu siphoned off more than 270 crore rupees over five years.

Industry Flags Concerns Over PROGA Enforcement

Several industry representatives have expressed surprise at the aggressive scale and timing of the operation. They argue that the enforcement drive is taking place even before the Promotion and Regulation of Online Gaming Act 2025 is officially notified.

Compounding this concern, they stated that companies were being questioned over highly technical processes, such as algorithms and certification systems, that officers themselves appeared to be still assessing. Officials reportedly seized electronic evidence and cloned data from multiple devices, while also alleging instances of non-cooperation from some companies that restricted employee access to their offices.

The Scope of the New Online Gaming Act

The Promotion and Regulation of Online Gaming Act, 2025 establishes a uniform national regime for the sector. While it promotes formats like e-sports and casual social games, it simultaneously imposes a blanket ban on all online games involving monetary stakes, irrespective of whether they are based on skill or chance.

The Act criminalises the offering, operation, and advertisement of such games, making the offences cognisable and non-bailable. The law restricts financial channels and blocks advertisements related to money-based online gaming, though individuals participating in the games will not be prosecuted. The framework aims to nurture competitive skill-based gaming while safeguarding users from the dangers of wagering-based platforms.

Expert Analysis: The High Cost of the “Money Game” Ban

The ED raids, coming just weeks after the PROGA 2025 ban took effect, are a clear, aggressive signal that the government is serious about dismantling the entire real-money gaming (RMG) ecosystem. The agency is not targeting simple tax evasion; it is probing money laundering and cheating, which are criminal offences that strike at the core of the industry’s integrity.

The focus on gaming federations and RNG certification is particularly noteworthy. This suggests the ED suspects that these “self-regulatory” or certification processes, once used to legitimize the difference between skill and chance, were co-opted to create a façade of compliance, enabling illicit financial flows.

The simultaneous allegations of algorithm manipulation and crypto wallets reveal the two central vulnerabilities of the now-banned money game platforms: internal fraud (rigging games) and external money laundering (using untraceable crypto). The Indian government is not attempting to reform the RMG industry; it is using the full force of its economic intelligence apparatus to permanently shift capital and talent away from money-based wagering and into the constitutionally protected e-sports and social gaming spaces. This operation serves as a stark warning to any company that attempts to find a loophole in the blanket ban.