Police raid XDirect, two employees arrested


21 January, AtoZForex.com, Lagos – Another remarkable case has emerged with the police raid XDirect in India. The Mauritius registered firm, XDirect has an indian office in the Mumbai area, to be be precise in Manubhai Towers in Sayajigunj. What often is overlooked is that XDirect is a subsidiary of the XTB Group, a global Polish financial entity. Nevertheless, at the start of the new year the India Police raid XDirect office in Mumbai, arresting two employees. The forex broker was busted for running illegal foreign exchange trading activities in the region.

Nowadays, more forex brokers are seeking to operate foreign exchange operations abroad, while often tend to overlook the compliance requisites. Marking the same case for XDirect, as the broker failed to register with the Reserve Bank of India and the Securities and Exchange Board of India (SEBI). Meanwhile the broker actively sought clients to trade the FX markets via their platform, for a commission on each client’s transaction.

Two arrest were made

As the Police raid XDirect, during the process two employees were arrested. Among the arrests is the manager of the Vadodara branch, Prathamesh Pandya and an additional employee Gunjan Patil. Both were arrested after the local authorities discovered that the firm lacked the due authorization to ply its business in the region. The city police commissioner E Radhakrishana commented as follow on the Police raid XDirect:

“Initial information suggests that XDirect, which is registered in Mauritius, has been running the illegal business in the city since February 2014. We raided the office and found that XDirect doesn’t have licence or permission from the government to operate and allow foreign exchange trading. They are also not registered with Securities and Exchange Board of India (SEBI). We will now visit their Mumbai office for further investigation,”

Promise of quick riches

Having operated since February last year without proper registration, XDirect has solicited for retail traders, requiring them to deposit Rs 35,000 as a minimum which is the equivalent of $515. On top of lacking the required registration, the Times of India reported that the police commissioner Radhakrishana also indicated that XDirect mislead its clients:

“The customers were promised quick earnings in short time through trading, while the entire operation was illegal.”

During the police raid, the Indian cops have seized one computer, two mobile phones, three laptops and a voice recorder from the XDirect Indian office. Stay tuned with AtoZForex for the latest news upon the case.

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