Bank Fraud: ED Attaches 78 Properties Of Chennai Firm

New Delhi [India]: The Enforcement Directorate (ED) said it has attached 78 immovable and 16 movable properties worth Rs 124 crores in the possession of various persons and entities linked to the Chennai-based Surana Group of Companies under the Prevention of Money Laundering Act (PMLA).

The action is in connection with the three cases of bank fraud involving Rs 3,986 crore of principal outstanding amount to the public sector banks, said the ED. Earlier, on August 2022, ED had attached 75 immovable properties, including 67 windmills valued at Rs 113.32 crore in total, of Chennai-based Surana Group of Companies, under the provisions of the Money Laundering Act.

The agency initiated a money laundering investigation on the basis of three FIRs by the Central Bureau of Investigation, BF and SB, Bengaluru registered against M/s Surana Industries Limited and others, M/s Surana Power Limited and Others, and M/s Surana Corporation Limited and others.

Based on the investigations conducted, 67 windmills with land valued at Rs 51.69 crore and various immovable properties valued at Rs 61.63 crore of Shri Ramlal Jain, who allegedly put the proceeds of crime into his regular business, were provisionally attached under the provisions of PMLA. The combined value of the windmills and immovable properties was estimated at Rs 113.32 crore.

ED stated that its investigations revealed that these three companies of Surana Group defrauded the banks by floating a web of shell companies wherein they appointed its employees/ relatives as Directors/ Proprietors/ Partners and indulged in paper transactions with them without actual movement of goods, the credit capital of the banks was round-tripped/ layered to the personal accounts of the promoters of the company by projecting the bank funds as unsecured loans from their associate shell companies and same funds were subsequently infused in the leading group companies as part of the promoters’ contribution to enhance the DP limits.

The probe revealed further that the Surana Group has companies in the Cayman Islands and the British Virgin Islands in the name of dummy directors and siphoned off money to be parked in these firms.

For this purpose, ED said they established four companies in Singapore and exported goods to them and the money received from them was written off in the book of accounts in India. Further, a portion of the diverted funds was used to purchase movable/immovable properties in the names of various benami persons/ companies, the agency informed further.

These actions of the promoters/officials of the Surana Group led to the accounts becoming irregular, ultimately resulting in the accounts turning into NPAs, ED said.

Based on the investigations conducted, Shri Dinesh Chand Surana, MD of M/s Surana Industries Limited and M/s Surana Power Ltd, Shri Vijay Raj Surana, MD of M/s Surana Corporation Limited, and two dummy directors of shell companies — P Anand and I Prabhakaran — were arrested on July 12. The principal session judge in Chennai remanded them to judicial custody.

Further Investigation is underway in the matter.