ED, attaches Rs100 crore properties, arrests 2 in shell company crackdown
05 April 2017
The Enforcement Directorate (ED) on Tuesday attached properties worth Rs100 crore in various locations and arrested two persons as it continued a nationwide crackdown on shell companies and money launderers.
The ED arrested G Dhananjaya Reddy from Bengaluru and K Liakath Ali from Chennai in separate cases of alleged money laundering.
An engineering graduate from Bengaluru, Reddy is reported to have floated more than 20 shell companies and obtained loans through dubious means.
Reddy had defrauded United Bank of India of Rs70 crore by "submitting forged or fake documents and by impersonation".
Reddy, who now faces three cases under the Prevention of Money Laundering Act (PMLA), was sent to two days' ED custody by a Bengaluru court.
The second accused Liakath Ali, who was nabbed from Chennai, was involved in cheating Indian Bank's Thousand Lights Branch in Chennai, using eight shell companies and remitted $11,778,120 (Rs78 crore) out of India, against forged bills of entry without effecting any actual imports, according to the ED.
Ali and his brother Eliyas Peer Mohamed fraudulently opened fictitious accounts in the names of shell companies like Galaxy Impex, Green International, and Snow City and Company.
The ED also attached assets worth over Rs61 crore in the multi-crore synthetic drug racket case in Punjab, while in Chhattisgarh it attached assets worth Rs36 crore of suspended IAS officer BL Agrawal, who is alleged to have laundered money through numerous fake bank accounts.
Besides, the agency attached assets worth Rs5 crore in connection with the money laundering case against Surat-based "hawala operator" Afroz Fatta and his associates.
The agency also attached over Rs36 crore worth of properties of Agarwal, who was the principal secretary (higher education) in the Chhattisgarh government, and was arrested by the Central Bureau of Investigation (CBI).
The attached property belongs to Agarwal and Raipur-based Prime Ispat Ltd, a company owned by his brothers.
According to the ED, Agarwal laundered money amassed through various fake bank accounts, with "active connivance of bank officials." Agarwal is alleged to have opened 446 benami bank accounts in the names of villagers in the Union Bank of India, Raipur.
The agency said that the funds were moved from the benami bank accounts to 13 shell companies operated by Agrawal, by way of investment.
The CBI had in 2010 registered cases against Agarwal on charges relating to impersonation, cheating and disproportionate assets. The Chhattisgarh Police, too, had registered a disproportionate assets case against him.
The ED also attached Rs61 crore worth of properties of Amritsar-based businessman Jagjit Singh Chahal and his kin in the multi-crore drug racket in Punjab.
The attached properties include showrooms, agriculture land, houses and seven luxury cars.
In the money laundering probe against several state politicians, the ED has so far attached Rs95 crore worth of properties.
The agency also attached Rs5 crore worth of assets belonging to Madanlal Jain, an accused in a money laundering case involving Hawala operator Afroz Fatta.
Fatta had used a chain of shell companies and his accomplices to funnel over Rs5,000 crore to foreign based companies.
The ED on 1 April conducted nationwide searches at over 100 premises in 16 states against 300 shell companies across the country