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ED Raids Pratibha Industries in Rs 4,957 Crore Loan Fraud Case

The Directorate of Enforcement (ED), Mumbai Zonal Office, carried out large-scale search operations on January 2 at 14 locations across Mumbai and Delhi, as part of their investigation into a Rs 4,957 crore loan fraud case involving M/s Pratibha Industries Limited and its associates

Mumbai: Extensive Searches at 14 Locations Across Mumbai and Delhi

The Directorate of Enforcement (ED), Mumbai Zonal Office, carried out large-scale search operations on January 2 at 14 locations across Mumbai and Delhi, as part of their investigation into a Rs 4,957 crore loan fraud case involving M/s Pratibha Industries Limited and its associates. The raids were conducted under the provisions of the Prevention of Money Laundering Act (PMLA), 2002.

Assets Frozen and Evidence Recovered in the Operation

As a result of the ED’s extensive search operation, a significant amount of incriminating evidence was recovered, and the authorities froze bank balances and mutual funds worth Rs 5.4 crore. The investigation also revealed details related to the acquisition of immovable properties connected to the alleged fraud.

FIR Filed by CBI and Allegations of Fraud

The case originated from an FIR filed by the Central Bureau of Investigation (CBI) following a complaint by the Bank of Baroda. The complaint accused M/s Pratibha Industries Limited, its director Ajit Kulkarni, and others of orchestrating a massive fraud, deceiving a consortium of lenders to the tune of Rs 4,957 crore.

Fraudulent Transactions and Criminal Conspiracy

According to the ED, the promoters and directors of M/s Pratibha Industries Limited were involved in a criminal conspiracy to divert loan funds for personal gains, leading to substantial financial losses for the banks. The fraudulent transactions included circular trading practices and the diversion of funds through suspicious channels.

Money Laundering and Concealed Funds

The ED further discovered that the promoters used the services of accommodation entry providers to layer and conceal the diverted funds. This was achieved through a network of fake entities and suspicious third-party transactions, which were subsequently used to acquire immovable assets.

Ongoing Investigation to Uncover Full Extent of Fraud

The ED has stated that its investigation is ongoing, and they are working to uncover the full extent of the money laundering activities. This includes identifying all the beneficiaries and tracing the diverted funds.

NPA and Fraud Declaration

The accounts of Pratibha Industries were classified as Non-Performing Assets (NPA) on December 31, 2017. Following this, the accounts were also declared as fraud by the members of the consortium of banks.

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