Last week the Indian Enforcement Directorate (ED) put out a statement saying that they had taken steps to freeze assets associated with the activity of broker Octa.
The ED is an Indian police agency that deals with financial crime.
The agency said that they had issued a ‘provisional attachement order’ for assets worth approximately $288m.
That purportedly includes a yacht owned by Octa’s shareholder Pavel Prozorov, which was in Spain.
In their statement, the ED also says that Prozorov is the mastermind behind Octa’s illegal activities in India.
That included using a fake platform that had fake charting and execution to take client funds. It also says Octa used illicit methods to take money out of India.
But perhaps the most striking claim was that Prozorov had been arrested in Spain.
The ED claims that the proceeds of Octa’s activity in India exceeded $600m. This is a huge amount of money and yet there are no reports about it in Spanish media that we can find, either in the media or from local police sources.
Moreover, the ED cannot freeze assets in Spain because it has no ability to do so. An Indian court cannot freeze undertake an asset freeze in Spain – it would have to get local authorities to do it.
What appears to have happened is that the ED has taken the first steps to freezing assets in India – which can now be frozen for 180 days – and has implied it will try to do the same for those abroad.
But actually getting assets abroad is a long-winded process and the ED’s statement suggests it has not really done anything to start that process.
Moreover, the claim that Prozorov was arrested in Spain appears to be based on an incident which took place several months ago. A source familiar with the matter told TradeInformer that Prozorov was arrested in Spain and then released after a couple of hours earlier this year.
