Indian crypto exchange WazirX, which is owned by Binance, is being investigated by the Compliance Administration of the Indian Ministry of Finance.
According to The Economic Times, the agency believes the platform may have been involved in laundering more than $350 million.
Pankaj Chaudhary, the country's finance minister, has said:
"In one of the cases, investigation done so far has revealed that One Indian crypto-exchange platform, Wazirx, was using the walled infrastructure of Cayman Island-based exchange BINANCE."
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In another case, the platform approved transactions by foreign users to exchange cryptocurrencies, even involving third-party exchanges.
WazirX has reported management is not aware of any complaints from the regulator regarding compliance with the law.