What's the news: India's Directorate of Enforcement (ED) conducted searches in the offices of Coda Payments India based on multiple FIRs registered against the company and the Garena Free Fire mobile app under the Prevention of Money laundering Act (PMLA), 2002, the agency said in a press release dated September 27. Additionally, all the bank accounts, merchant IDs in payment gateways and fixed deposits of Coda India with a total balance of ₹68.53 crore have been frozen, the agency said. What does Coda do? Coda provides payment solutions for app developers, especially gaming companies, for in-app purchases. Its services are used by popular gaming companies like Activision Blizzard, Riot Games, and Krafton. Why does this matter? ED is looking into whether Coda is facilitating and collecting payments from "unsuspecting children" by "resorting to unauthorized deductions" from players of games like "Garena Free Fire, Teen Patti Gold, Call of Duty etc." The allegations (outlined below) point out that gaming apps use deceptive tactics to trick children into paying for in-game purchases. Companies are able to get away with such practices because there are no regulations specifically targeting gaming apps or such practices. ED's probe sends a message to these companies that they can be investigated under PMLA for such conduct. What are the allegations against Coda? Game developers like Coda "have intentionally designed the payment mechanism in such a way that after first successful transaction, a notification pops-up which seeks permission to make subsequent payments without any authentication. As the children are not aware of…
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