India’s Financial Intelligence Unit (FIU-IND) has flagged 15 cryptocurrency platforms for allegedly failing to meet the country’s anti-money laundering requirements.

The agency issued non-compliance notices on Tuesday under Section 13 of the Prevention of Money Laundering Act. The action involves small and medium-sized virtual digital asset service providers, including Weex, Blofin, Rezorex, Bitunix, DigiFinex, Toobit, XT.com, Latoken, WOO X, Pionex, ChangeNow, SimpleSwap, FixedFloat, WhiteBIT and Guardarian.

India brought virtual digital asset (VDA) service providers under its anti-money laundering regime in March 2023. The rules cover crypto platforms that provide services to Indian customers, even if those companies have no physical office or establishment in the country.

Under the framework, platforms must register with FIU-IND and follow requirements covering customer verification, record retention and the reporting of suspicious transactions to the authorities.

FIU-IND also reminded the public that cryptocurrencies and non-fungible tokens (NFTs) carry significant risks. The agency said these products are unregulated and warned that people who lose money through such transactions may have little or no access to regulatory remedies.

The latest action comes shortly after The Economic Times reported that Indian users are increasingly transferring stablecoins such as USDT to overseas platforms in Sweden, Germany and Singapore. These services reportedly convert the digital assets into gift cards, which can then be used in India to pay for groceries, fuel and gold.

Such a system could allow users to move funds outside Indian exchanges, potentially making those transactions harder for domestic authorities to monitor.

FIU-IND previously took action against nine major offshore crypto exchanges in December 2023. The group included Binance, Kraken and KuCoin. The agency issued show-cause notices over compliance concerns and asked the IT ministry to block their website URLs over alleged unlawful operations in India, according to the Press Information Bureau.

Binance later registered with FIU-IND and paid a penalty of INR 18.82 crore for anti-money laundering violations. The record fine highlighted the regulatory risks facing offshore crypto platforms that serve Indian customers without meeting the country’s compliance requirements.