Bank loan fraud: ED raids Deccan Chronicle Holding Ltd; seizes Rs 5L in demonetised currency
New Delhi: The Enforcement Directorate (ED) on Friday said it had raided the premises of the chairman and the managing director of Deccan Chronicle Holding Limited, and seized Rs five lakh in demonetised currency in connection with a money-laundering probe linked to a multi-crore-rupee bank loan default case.
The federal agency, in a statement, said the raids were carried out in the Banjara Hills area of Hyderabad and in Secunderabad on Thursday against the media group that brought out English daily Deccan Chronicle.
The action was carried out under the provisions of the Prevention of Money Laundering Act (PMLA), it said. Raids were conducted at the residential and office premises of the chairman of the group, T Venkatram Reddy, and managing director T Vinayak Ravi Reddy to "gather evidence of money laundering and trace the proceeds of crime", it said.
"The searches resulted in the seizure of incriminating documents relating to immovable properties and digital evidence, two luxury cars and demonetised currency to the extent of Rs 5 lakh.
"The digital evidence is being analysed further to trace the diversion of the loan funds," the Enforcement Directorate (ED) said. The agency had filed a PMLA case against the group and its executives on the basis of CBI chargesheets filed in 2015-16 in the bank fraud case.
The total volume of the bank fraud, the ED said, was estimated to be over Rs 2,323 crore and it involved a number of banks, including the Canara Bank and the Andhra Bank, among others.
The Central Bureau of Investigation (CBI) had registered a criminal case for alleged cheating and criminal conspiracy in the bank loan fraud case in 2013. The ED had also attached assets worth Rs 263 crore in the case in 2017.
"The total outstanding amount due to all the banks put together is now pegged at more than Rs 8,000 crore. There are allegations that the accused individuals and others defrauded the banks by availing loans by projecting a false and rosy financial picture and fabricated advertising revenues and then, subsequently, diverted the funds from the stated business purposes for their personal enrichment," the ED said.
It alleged that the group also fraudulently "invested in other concerns" such as Odyssey India Limited, Deccan Chargers Sporting Ventures Limited (IPL franchise, which was suspended for match-fixing), Flyington Freighters Limited (diverted Rs 227.85 crore to purchase 12 cargo planes from Airbus SAS France) and Sieger Solutions Limited, causing massive losses and leading to non-performing assets for the lender banks.
Further investigation in the case was on, the agency said.