₹1,438.45 cr bank loan fraud: ED attaches assets worth ₹43.52 cr linked to UIL
The ED has attached assets worth ₹43.52 crore linked to Ushdev International in a ₹1,438.45 crore loan default case involving money laundering.
MUMBAI: The Mumbai zonal unit of the Enforcement Directorate (ED) has provisionally attached movable and immovable assets worth ₹43.52 crore as part of its money-laundering investigation related to a ₹1,438.45 crore bank loan default case involving metal trading company Ushdev International Limited (UIL) and others.
The investigation has revealed that funds granted as loans by a consortium of banks were allegedly diverted and then brought back to Indian firms, in which the overseas subsidiaries of the accused’s companies were majority shareholders.
The attached assets, suspected to be proceeds of crime in the case, are in the form of land plots, a building and funds lying in bank accounts in the form of fixed deposits, said an ED official, who requested anonymity as they aren’t authorised to speak to the media. The loan funds granted to Mumbai-headquartered UIL were allegedly diverted to different entities in the “guise of advances and unsecured loans” and subsequently brought back to India-based firms by routing them via multiple bank accounts, the official added. The subsidiaries were allegedly controlled by UIL’s directors and major shareholders.
UIL allegedly syphoned off most of the funds from credit facilities from multiple banks to several overseas firms incorporated by its directors, promoters or shareholders. During the investigation, India-based assets worth ₹43.52 crore belonging to UIL’s directors, shareholders and subsidiaries were identified and provisionally attached under the provisions of the Prevention of Money Laundering Act.
ED’s money-laundering investigation is based on a July 2022 First Information Report (FIR) registered by the Central Bureau of Investigation’s bank security and fraud cell against UIL, its two directors, and unknown public servants, among others. The case was registered based on a complaint lodged by the State Bank of India, alleging that the accused had conspired to cheat a consortium of banks it led that had sanctioned credit facilities to UIL from April 2013 to March 2018, and caused losses to them.
The loan accounts were later classified as non-performing assets on October 2, 2016. Later, the consortium got a forensic audit of the transactions done for the period between April 2013 and May 2018, which pointed to various alleged irregularities in the accounts, the ED official said.