Indian probe agency hits gaming firms again on second day
The Enforcement Directorate (ED), a law enforcement and economic intelligence agency of the Government of India intensified its action against the online gaming industry on Wednesday as raids on Gameskraft and WinZO continued for a second consecutive day. The searches, which began on Tuesday, covered 11 locations across Bengaluru, Delhi and Gurugram. Officials are examining allegations of money laundering, cheating and irregularities linked to financial structures and certification processes used by gaming companies.
The raids came shortly after the central government enforced the Promotion and Regulation of Online Gaming Act (PROGA) on 1 October, which imposes a blanket ban on online money-based games where users stake funds for a chance to win. In response, platforms like Gameskraft and WinZO suspended their real-money gaming operations in India.
Focus on federations and certification
According to Storyboard18, ED teams questioned employees, founders and senior executives about the role of gaming federations in issuing certificates for opening bank accounts. Investigators also sought details about Random Number Generator certification that companies use to validate game fairness. Authorities are checking whether these bodies helped create structures that may have enabled financial irregularities.
Although the agency has not officially identified more entities under investigation, a senior source confirmed that complaints against several other gaming companies have placed them under preliminary review. It is not yet clear how wide the investigation will expand, but insiders believe more firms may come under scrutiny in the coming days.
Industry flags concerns over enforcement timing
Several industry representatives said they were surprised by the scale of the operation. As reported by Storyboard18, they stated that the enforcement drive is taking place even before the Promotion and Regulation of Online Gaming Act 2025 is officially notified. They added that companies were being questioned over technical processes such as algorithms and certification systems that officers themselves appeared to be still assessing.
Officials seized electronic evidence from offices and homes and cloned data from multiple devices. They also reported instances of non cooperation during the operation, alleging that some companies did not share adequate information and restricted employees from accessing their offices.
Crypto links and algorithm complaints under review
Investigators said the raids relate to suspected cheating and money laundering involving cryptocurrency. Officers stated that they found evidence of promoters holding crypto wallets, which they believe may indicate possible laundering activities. The agency is also checking whether certain gaming platforms manipulated game outcomes. FIRs filed by individuals alleging algorithm manipulation have added to the scope of the probe.
The action against Gameskraft is also linked to Pocket52, an online poker platform owned by the company. Pocket52 shut down in July 2025 and cited regulatory pressure and the 28 percent Goods and Services Tax (GST) rate on real money gaming. Gameskraft is already dealing with internal issues as its former chief financial officer Ramesh Prabhu has been accused of siphoning off more than 270 crore rupees over five years. An FIR has been registered following the company’s complaint.
Act overview
The Promotion and Regulation of Online Gaming Act, 2025 establishes a nationwide prohibition on online games involving monetary stakes. This ban covers both skill-based and chance-based games whenever real money is involved. Offering or operating such games is treated as a criminal offence, categorised as cognisable and non-bailable.
The Act also blocks advertisements, promotional activities, and financial services linked to money-based online gaming. By restricting visibility and financial channels, the government aims to curb the growth of these platforms. While companies, promoters, advertisers, and financial intermediaries will face penalties, individuals who participate in money-based games will not be prosecuted, according to official sources.
Importantly, the law draws a clear line between wagering-based games and harmless recreational gaming. It formally recognises e-sports and casual social games, which are expected to benefit from increased institutional support. According to the government, this framework will help nurture competitive skill-based gaming and digital entertainment, without exposing users to the dangers of gambling.
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