In a crackdown on the illegal sale of beauty products falsely marketed as “FDA-approved”, the Enforcement Directorate (ED) has launched a special investigation following an FIR registered in Punjab. Acting under the Prevention of Money Laundering Act (PMLA), 2002, the financial crime investigation agency conducted searches on August 12 and 13 at multiple locations in Delhi and Mumbai linked to Instagram influencer Sandeepa Virk and her associates. Virk was arrested on August 12 and produced before the Competent Court, which granted ED custody until August 14 for further investigation.
According to the ED, the said individuals used a website for laundering money based on a limited product range, high prices, fake FDA claims and technical glitches, and even purchased real estate through these false promises.
In a statement on Wednesday, the ED said the individuals involved are “alleged to have exerted undue influence through misrepresentation and defrauded individuals by soliciting money under false pretences”.
ED takes strict action against influencer Sandeepa Virk and her associates over alleged fraud and false claims
According to the agency, its probe found that Virk had acquired immovable property in her name through false promises and deceit. She claimed to own hyboocare.com, a website purportedly selling FDA-approved beauty products, but the products listed were found to be non-existent. The site had no user registration feature, suffered from persistent payment gateway issues, and displayed minimal social media activity. Its WhatsApp contact number was inactive, and it lacked transparent organisational details — all of which, the ED said, pointed to a non-genuine business operation.
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“These factors, including a limited product range, inflated pricing, false claims of FDA approval, and technical inconsistencies, indicate that the website was being used as a front for laundering funds,” the ED stated.
The investigation also revealed that Virk was in regular contact with Angarai Natarajan Sethuraman, a former director of the now-defunct Reliance Capital, regarding alleged illegal liaising work. A search of Sethuraman’s residence confirmed this connection, the agency said.
The ED alleged that funds had been diverted for personal gain. In 2018, Rs 18 crore of public money from Reliance Commercial Finance Ltd (RCFL) was disbursed to Sethuraman in violation of prudent lending norms. The loan terms allowed deferment of both principal and interest, multiple waivers were granted, and no due diligence was conducted.
In another case, a Rs 22 crore home loan from Reliance Capital was sanctioned in violation of prudential norms, with a substantial portion of the funds “siphoned off and remaining unpaid”.
During the searches, the ED seized several incriminating documents and records, and recorded statements from key individuals, including one Farrukh Ali.
