ED attaches Rs 177-cr assets in Rotomac bank fraud caseMay 29, 2018 14:24
The Enforcement Directorate today said it has attached assets worth Rs 177 crore in connection with its money laundering probe against Kanpur-based Rotomac group in an alleged bank loan fraud of Rs 3,695 crore.
The agency said it has issued a provisional order yesterday under the Prevention of Money Laundering Act for attachment of properties "owned by Ms Rotomac Global Private Limited and its directors located at Kanpur (Uttar Pradesh), Dehradun (Uttarakhand), Ahmedabad and Gandhi Nagar (Gujarat) and Mumbai (Maharashtra) valuing Rs 177 crore."
It alleged that these assets were the "proceeds of crime" of the illegal act of money laundering.
The ED probe revealed, the agency said in a statement, that Ms Rotomac Global Private Limited "indulged in merchanting trade with limited number of buyers and sellers and it used to receive back the discounted LC (letters of credit) amount from the overseas beneficiary after deduction of 1.5-2 per cent commission by them either directly into the accounts of Rotomac group companies or into the accounts of overseas companies controlled by owner Vikram Kothari."
This discounted LC amount, it said, thereafter has been used by the firm for "other business activities" such as FDR (fixed deposit receipts), iron ore purchase and investment in real estate.
It said the oversall modus operandi to perpetrate this alleged bank fraud was that the accused, in guise of merchanting trade, without having any genuine business transactions defaulted in meeting their payments obligation to the bank by "diverting and siphoning off the funds."
The ED had filed a criminal case under the PMLA in this instance in February, based on a CBI FIR.
The ED-CBI case has been registered against firm director and owner Vikram Kothari, his wife Sadhna Kothari, son Rahul Kothari and unidentified bank officials on a complaint from the Bank of Baroda. -- PTI