ED raids Amazon and Flipkart sellers over money laundering allegations
The Enforcement Directorate (ED) on Thursday conducted nationwide raids on sellers associated with major e-commerce platforms, including Amazon and Flipkart. The raids, aimed at uncovering potential financial irregularities, were part of an ongoing money laundering investigation, CNBC-TV18 reported. The targeted offices are located in New Delhi, Mumbai, and Bengaluru. However, the specific identities of the raided sellers have not been disclosed yet.
Raids follow antitrust body's findings
The ED is investigating potential financial irregularities by certain sellers on Amazon and Flipkart. The probe aims to determine if these sellers have exploited the platforms to launder money or engage in other illicit financial activities. This action underscores the increasing scrutiny on e-commerce platforms in India, particularly regarding compliance with foreign investment rules and tax regulations.
Long-standing allegations against Amazon and Flipkart
Notably, this isn't the first time Amazon and Flipkart have been under the scanner for their business practices. For years, Indian brick-and-mortar retailers have alleged that the e-commerce platforms violated foreign investment rules by giving preferential treatment to select sellers. A 2021 Reuters investigation, citing internal Amazon documents, found that the company exercised considerable control over the inventory of some of its biggest sellers on Amazon.in, which is against Indian laws for foreign e-commerce entities.
