Google (NASDAQ:GOOG) and Yahoo (NASDAQ:YHOO) units in India are being investigated for potential violations of the country’s foreign exchange laws, according to a Wall Street Journal report.

The WSJ report cites a senior official at a division of India’s federal finance ministry, which monitors foreign exchange transactions and money-laundering activities, saying that notices have already been sent to the companies’ Indian units that they are being investigated.

However, when reached for comment, a spokesperson for India’s finance ministry would not confirm whether notices of the investigation were sent to the two companies.

“We have an obligation to our shareholders to set up a tax efficient structure and our present structure is compliant with the tax rules in all the countries where we operate,” the spokesperson for Google India said, adding that Google has not yet received any notice of an investigation.

Google and Yahoo are among at least a dozen other companies being urged by India’s government to better police their websites for offensive content. Google and Facebook have already made some changes to their websites after a court order warned them of a crackdown “like China” if they didn’t resolve the issues.

To contact the reporter on this story: Laurie Danas at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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