PMC Bank Case: ED raids 6 locations, files money-laundering case

PMC Bank Case: ED raids 6 locations, files money-laundering case
The ED conducted raids at six locations and filed a criminal complaint against PMC bank officials & HDIL promoters under the Prevention of Money Laundering Act (Representational Image, Courtesy: southasiansnews.com)

The Enforcement Directorate (ED) on Friday raided six locations in and around Mumbai and registered a money-laundering case to probe alleged fraud in the Punjab and Maharashtra Cooperative (PMC) Bank case.

According to officials, the raids were conducted after a criminal complaint was filed under the Prevention of Money Laundering Act by the central agency.

The ED, whose Enforcement Case Information Report (ECIR) is based on an FIR filed by the Economic Offences Wing (EOW) of Mumbai police, conducted the raids with the purpose of gathering additional evidence.

The ED and Mumbai Police case is against former bank management and promoters of the Housing Development Infrastructure Limited (HDIL). They are also probing a possible nexus between the two entities.

Last week, the police had registered an FIR against the firm’s management – accusing them of forgery, cheating, and criminal conspiracy – following a complaint by an RBI-appointed administrator.

The bank’s former chairman Waryam Singh, managing director Joy Thomas and other senior officials, along with a director of HDIL, have been named in the FIR.

According to the initial investigation, the bank’s losses since 2008 were Rs 4,355.46 crore.

Cops also said that the bank allegedly deposited around Rs 2,000 crore directly into HDIL bosses’ personal accounts while the loans were officially sanctioned under the company’s name.

On September 23, the RBI had put a slew of restrictions on PMC bank for six months over several irregularities, including under-reporting of NPAs. The restrictions included curbs on fresh lending, accepting fresh deposits and investments, among others.

The withdrawal limit for account holders was also kept at Rs 1,000 for six months, which was raised to Rs 10,000 and subsequently to Rs 25,000.

The RBI has also appointed a three-member committee to assist the RBI-appointed administrator of the bank.

In a related development, the Mumbai Police arrested Rakesh Kumar Wadhawan and Sarang Wadhawan – the promoters of HDIL – in connection with the PMC bank case on Thursday.

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