By Sarita Chaganti Singh and Ira Dugal

NEW DELHI (Reuters) – India’s central financial institution has discovered a whole lot of 1000’s of accounts at Paytm Payments Bank created with out correct identification and has handed the knowledge on to the nation’s monetary crime preventing company, three sources aware of the matter stated.

The Reserve Bank of India (RBI) is worried that a number of the accounts may have been used for cash laundering, the sources stated, talking on situation of anonymity.

As effectively as informing the Enforcement Directorate, the RBI has despatched its findings to the ministry of residence affairs and the prime minister’s workplace, they added.

“One 97 Communications Ltd. and Paytm Payments Bank have never been probed by the Enforcement Directorate,” a Paytm Payments Bank spokesperson stated, referring to the financial institution’s mother or father firm, the digital funds operator popularly generally known as Paytm.

“Some merchants using our platforms have been the subject of investigations and we answer authorities on this same as and when asked. We strongly refute money laundering allegations and caution you against speculation,” the spokesperson added.

The RBI, the Enforcement Directorate, finance ministry, residence ministry, and prime minister’s workplace didn’t reply to requests for remark outdoors regular workplace hours.

The RBI on Wednesday ordered Paytm Payments Bank to wind down most of its companies, together with deposits, credit score merchandise and its fashionable pockets by Feb. 29.

It cited “persistent non-compliances and continued material supervisory concerns in the bank”, with out giving particulars.

The Enforcement Directorate will probe Paytm Payments Bank if any proof of criminality is discovered, Revenue Secretary Sanjay Malhotra advised Reuters on Saturday.

Paytm’s inventory plunged 36% within the two days following the RBI’s transfer towards its financial institution, wiping $2 billion off its market worth.

Paytm’s founder Vijay Shekhar Sharma, a rags-to-riches star of the Indian startup scene, described the RBI’s motion as a “speed bump” throughout a convention name with analysts on Thursday.

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Two of the sources stated a number of accounts at Paytm Payments Bank had been linked to the identical identification proof and that transactions in these accounts bumped into thousands and thousands of rupees.

An “unusually” excessive variety of dormant accounts had additionally been discovered, certainly one of them added.

(Reporting by Sarita Chaganti Singh in New Delhi and Ira Dugal in Mumbai; Editing by Mark Potter)