Hyderabad: In a major breakthrough in the ongoing investigation into illegal online gaming operations, GST Intelligence, Hyderabad has arrested Shri Pankaj Kumar, the founder and director of Adsum Advisory Service Pvt Ltd. The company specializes in fraud detection and customer verification services, including digital KYC verification for financial institutions.
The arrest comes after investigators uncovered evidence pointing to an organized syndicate valued at Rs 13,000 crore that operated illegal online gaming websites. The syndicate allegedly functioned with the assistance of multiple fintech companies, including payment aggregators, payment gateways, and third-party technology service providers who facilitated the flow of funds through the illegal gaming network.
According to GST Intelligence officials, Shri Pankaj Kumar played a crucial role as one of the masterminds behind fraudulent KYC verification of merchants and shell entities. These verifications were conducted on behalf of RBI Regulated Entities such as Payment Gateways and Banking as Payment Aggregator (BAPA) systems, enabling illegal transactions to appear legitimate.
Despite being the director of a company responsible for the KYC verification process, Shri Pankaj Kumar allegedly failed to develop proper risk profiling of customers based on ownership and control structures. Investigators claim he deliberately helped in onboarding shell entities for UPI integration, which was essential for channeling money from online gaming operations into the financial system.
The investigation revealed that Shri Pankaj Kumar was one of the beneficiaries who received illegitimate proceeds of crime generated by the online gaming syndicate. His company’s verification services allegedly provided a veneer of legitimacy to fraudulent entities, allowing them to process large volumes of transactions without triggering regulatory alarms.
The scale of the online gaming industry in India has grown exponentially in recent years. According to estimates for the year 2025, the gross valuation of online gaming in India stands at approximately USD 23 billion, equivalent to around two lakh crore rupees. This massive market size has attracted both legitimate operators and criminal syndicates seeking to exploit regulatory gaps.
DGGI, Hyderabad has launched a massive crackdown on online gaming syndicates and their associated fintech enablers. As part of this operation, authorities have taken action against multiple fintech companies and frozen bank accounts totaling Rs 100 crores. The current arrest of Shri Pankaj Kumar is part of a broader strategy to dismantle the entire network of masterminds operating these illegal gaming platforms.
The investigation by GST Intelligence continues to trace the flow of funds and identify other key players involved in the syndicate. Authorities are examining the role of various payment aggregators, technology service providers, and verification companies that may have knowingly or unknowingly facilitated the operations of illegal online gaming websites across the country.
