Rs 5,000 crore GST fraud uncovered

Online gaming scam

Hyderabad GST Intelligence officials have unearthed a massive online gaming tax evasion racket worth nearly Rs 5,000 crore, exposing one of the largest scams in the sector. Operating under the cover of legitimate gaming platforms for several years, the syndicate allegedly siphoned off funds from gaming transactions while evading government taxes. The crackdown followed months of detailed intelligence gathering and precision raids, resulting in the seizure of critical evidence.

Investigations have identified YS Prabhukumar from Mumbai and Rajasekhar Reddy from Hyderabad as the key masterminds behind the network. Authorities say the duo coordinated a nationwide structure to channel thousands of crores through online gaming platforms. The group is accused not only of evading the mandatory 28 percent GST but also of funneling the proceeds overseas through hawala channels.

On Sunday, GST Intelligence teams conducted simultaneous raids in Hyderabad, Delhi, and Mumbai. Gaming company offices and residences of key executives were searched, and laptops, mobile phones, and crucial digital documents were seized. Authorities are now analyzing years of financial and digital data to determine the total scale of tax evasion and to identify all participants involved.

Although only the two main operators have been arrested so far, officials believe several other influential figures are part of the syndicate. Preliminary findings suggest that cash collected from gaming app users was routed abroad through shell companies, indicating that this scam involves not just tax evasion but also major financial crimes. Authorities have indicated that more arrests and sensational revelations are expected in the coming days.

The raids have sent shockwaves through the online gaming industry, with operators nationwide facing increased scrutiny. GST Intelligence sources said the success of these operations was due to sustained monitoring and meticulous data collection over several months, which allowed them to identify the syndicate’s leaders and uncover its operational methods.

Officials stressed that cracking this network is only the beginning. As investigations unfold, additional arrests and disclosures of hidden transactions are anticipated. The raids also serve as a warning to other gaming operators attempting similar schemes, highlighting that large-scale tax evasion and financial misconduct will be detected and penalized. The operation marks a significant victory for GST enforcement in the rapidly expanding online gaming sector and demonstrates the authorities’ resolve to tackle organized financial crime.