India’s Enforcement Directorate (ED) carried out searches at eight locations in Bengaluru on Tuesday as part of a probe into alleged foreign exchange violations involving the Open Society Foundations (OSF) and its investment arm, the Soros Economic Development Fund (SEDF).
Officials say the investigation, conducted under the Foreign Exchange Management Act (FEMA), focuses on OSF and its collaborations with international human rights organizations. Authorities are examining claims that the foundation facilitated foreign direct investment (FDI) and that some recipients misused these funds in violation of Indian regulations.
A senior officer noted that the raids targeted suspected irregularities in FDI rules concerning SEDF and OSF investments in multiple Indian entities and individuals, along with how the funds were ultimately utilized. Reports indicate that nearly $3 billion from Soros-backed OSF was channeled to over a dozen organizations across India.
The preliminary inquiry revealed that in 2016, the Ministry of Home Affairs (MHA) had placed OSF under the “prior reference” category, restricting its ability to make unregulated donations to Indian NGOs. Allegedly, OSF created subsidiaries in India and routed funds as FDI and consultancy fees, which were then used to support NGO activities—actions considered a FEMA violation.
Although OSF has been active in India since 1999, the organization reportedly maintains no physical offices in the country.
