The Karnataka High Court ordered the immediate release of Gameskraft cofounders Vikas Taneja, Deepak Singh, and Prithviraj Singh, declaring their arrest by the Enforcement Directorate illegal. The order came after the cofounders challenged their detention in a money laundering case, with the court directing prison authorities to release them forthwith, according to inc42.com.
The three cofounders were arrested by the Enforcement Directorate on May 7 as part of a probe into alleged money laundering linked to Gameskraft. The ED conducted searches in Bengaluru and Delhi NCR between May 7 and May 13, freezing assets following multiple FIRs accusing the startup of cheating. Earlier, a sessions court had placed the cofounders in judicial custody until June 2, 2026. The Karnataka HC had previously stayed the ED’s probe in January, citing a closure report in the predicate offence FIR.
The Enforcement Directorate argued it could update its investigation if new offences emerged, accusing Gameskraft of manipulating game outcomes and encouraging large user deposits. The case highlights regulatory scrutiny faced by gaming startups amid allegations of financial irregularities. The Karnataka HC’s ruling underscores judicial checks on enforcement actions, especially when prior closure reports exist in related cases.
The Karnataka High Court’s order was passed by Justice M Nagaprasanna and was reported yesterday. The cofounders’ release follows the court’s declaration that their arrests were contrary to law, marking a significant judicial intervention in the ongoing probe against Gameskraft, according to inc42.com.