In a significant crackdown on India's online gaming sector, the Enforcement Directorate has arrested WinZO Games founders Saumya Singh Rathore and Paavan Nanda in connection with a major money laundering investigation. The arrests came on Thursday following extensive searches conducted by the federal probe agency across multiple cities.
The Arrest and Court Proceedings
The two WinZO founders were produced before a local court in Bengaluru on the same night of their arrest and were remanded to one-day custody. Officials confirmed that both individuals are expected to be produced again before the court for a detailed order regarding their ongoing detention and investigation.
The enforcement action represents one of the most significant interventions by Indian authorities into the rapidly growing online gaming industry, which has faced increased regulatory scrutiny in recent months.
Massive Financial Freeze and Allegations
The arrests followed the ED's announcement that it had frozen collective deposits worth approximately ₹523 crore belonging to online gaming companies WinZO and Gameskraft. According to official statements, the agency specifically froze alleged proceeds of crime worth about ₹505 crore that were "possessed" by WinZO Games under the Prevention of Money Laundering Act (PMLA).
Investigators revealed that these substantial deposits were maintained in various financial instruments, including bonds, fixed deposits, and mutual funds across multiple bank accounts.
Key Allegations Against WinZO
The ED has leveled several serious allegations against the gaming platform. The agency claims that WinZO held funds worth crores of rupees that should have been refunded to players following India's recent ban on real-money gaming effective from August 22, 2025. Specifically, the ED stated that "even after the ban of RMGs by the Union government, an amount of ₹43 crore is still held by the company without refunding to the gamers/customers."
Between November 18 and 22, the federal probe agency conducted multiple searches in Delhi, Bengaluru, and Gurugram as part of its money laundering investigation targeting the parent companies—Nirdesa Networks Pvt. Ltd. (NNPL), Gameskraft Technologies Pvt. Ltd. (GTPL), and WinZO Games Pvt. Ltd.—along with their promoters.
One of the most serious accusations involves WinZO allegedly engaging in criminal activities and unscrupulous practices where customers were made to play with algorithms without being informed that they were competing against software rather than human opponents in real-money games.
International Operations and Fund Diversion
The investigation uncovered that WinZO was operating real-money games in several international markets, including Brazil, the United States, and Germany, from its India-based platform. The ED claimed to have discovered that global operations of WinZO were conducted through a single application, meaning all international services were hosted from the India-based platform.
More significantly, the agency alleged that funds from the Indian entity were diverted to the United States and Singapore under the guise of overseas investment. The ED charged that "funds worth USD 55 million (approximately ₹489.90 crore) have been parked in their (WinZO) bank account in the US, which is a shell company since all the operations and day-to-day business activities and operation of bank accounts were done from India."
Additionally, the enforcement agency accused WinZO of preventing or limiting withdrawals of money held by customers in their wallets, thereby generating alleged illicit funds through what they described as "unscrupulous" use of algorithms and software in real-money games.
WinZO's Response and Founder Profiles
In response to the allegations, a WinZO spokesperson stated that the company was "cooperating fully with the investigating agency and will continue to support the process." The company emphasized that "fairness and transparency are core to how WinZO designs and operates its platform" and that their focus remains on protecting users and ensuring a secure, trustworthy experience.
Saumya Singh Rathore, one of the arrested co-founders, previously worked with her co-accused Paavan Nanda at Zo Rooms. She had emerged as one of the youngest additions to the Kotak Private Banking Hurun Leading Wealthy Women List in 2021, with an estimated wealth of ₹520 crore.
Paavan Nanda, aged 38, is an established Indian entrepreneur who founded WinZO in 2018. Prior to this venture, he played a key role in developing Zostel, a chain of backpacker hostels, and its budget-hotel aggregator sibling venture, ZO Rooms.
The case continues to develop as investigators delve deeper into the operations of online gaming platforms in India and their compliance with the country's evolving regulatory framework for real-money gaming operations.
