Mumbai, Sep 14 (IANS): The Enforcement Directorate (ED) seized Rs 18 lakh in Indian currency and foreign currency amounting to USD 9,567 and 860 Zambian Kwacha during raids conducted at 11 premises in Mumbai and Delhi linked to Alfara’a Infraprojects Pvt Ltd (AIPL), its directors, and close associates in connection with an alleged bank fraud and money laundering case involving over Rs 255 crore, an official statement said on Monday.
The searches were carried out on September 10 by the ED’s Mumbai Zonal Office-I under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, as part of an ongoing investigation. The authorities also froze fixed deposits valued at approximately Rs 1.02 crore, Japanese yen 1.75 crore and $1,03,145.
The searches also led to the seizure of several incriminating documents, digital devices and records relating to banking transactions, Letters of Credit, Bank Guarantees, and immovable properties linked to the accused and other suspect entities.
According to the ED, the material collected during the searches is expected to help establish the trail of proceeds of crime allegedly generated and layered through banking channels. Further investigation is underway.
The probe stems from an FIR registered by the Central Bureau of Investigation’s Economic Offences Branch in Chennai against AIPL and others on a complaint filed by Bank of Baroda.
According to the ED, AIPL, a civil construction company, had availed credit facilities worth Rs 103 crore from Bank of Baroda in 2012, which were enhanced to Rs 360.50 crore in 2015. The loan account was declared a non-performing asset (NPA) on June 18, 2018, with outstanding dues of Rs 255.74 crore.
The agency’s investigation has prima facie revealed that Letters of Credit (LCs) worth about Rs 75.02 crore devolved, while Bank Guarantees (BGs) amounting to around Rs 164.59 crore were invoked, resulting in the generation of proceeds of crime.
A substantial portion of the funds was allegedly routed through multiple intermediary and beneficiary entities before being diverted to AIPL and its group companies through layered transactions aimed at concealing their origin.
The ED further alleged that foreign bank guarantees were opened in the guise of exports of glazed tiles that were never executed, following which funds were remitted to entities based in Singapore and Hong Kong.
Several of these LCs and BGs later devolved or were invoked due to non-payment by AIPL, causing wrongful losses to the lending bank and facilitating the siphoning of funds, the agency said.
Given the magnitude of the alleged fraud and the financial trail uncovered during the investigation, the ED covered premises linked to the accused, their family members, close associates and entities with financial connections to them during the search operations.
