CA firms in focus as ED launches searches on `benami' properties
15 April 2017
The Enforcement Directorate last week arrested a chartered accountant for allegedly laundering the ''ill-gotten'' money of a Chhattisgarh Principal Secretary, Babu Lal Agrawal, who was arrested recently by the Central Bureau of Investigation.
Reports said Sunil Agrawal, whose firm is based in Raipur, provided services mainly to Prime Ispat Ltd and its directors, including the 1988-batch IAS official who faces three CBI cases of corruption.
''The CA was the key person who helped Mr Agrawal launder the unaccounted money through 446 ''benami'' accounts with two Union Bank of India branches in the name of villagers without their knowledge,'' an ED official was quoted as saying.
The funds, after being deposited in these accounts, were immediately transferred to 13 shell companies, which had allegedly been formed by the CA. The money was routed through the shell companies as share application money. More than Rs36 crore was invested as share capital in Prime Ispat, in which the IAS official's brothers became directors. Equity shares of the shell companies were ultimately bought by Prime Ispat's sister concerns.
In another case involving over Rs200-crore ''benami'' transactions, the agency searched the premises of six other chartered accountants in the national capital, who were alleged to have helped route Rs200 crore through shell companies, allegedly formed by brothers Surendra and Virendra Jain.
The ED had arrested the Jain brothers last month under the Prevention of Money Laundering Act.
Searches were carried out in Lakshmi Nagar, Dilshad Garden, Rana Pratap Bagh, Azadpur, Karolbagh, Model Town, Dariba Kalan and Bahadur Shah Zafar Marg areas of Delhi.
The Serious Fraud Investigation Office (SFIO), on whose case the ED is taking action, had in its report mentioned that the Jain brothers had laundered Rs3,790 crore between 2004 and 2011. In 2009-10 alone, they allegedly laundered Rs561 crore for 559 clients, with the help of 56 intermediaries like chartered accountants and company secretaries.
So far, the SFIO has filed criminal complaints against 11 companies controlled or managed by the Jains while the ED has attached assets worth Rs64.70 crore in the case.