The Aryavarth Express
Agency(Mumbai): The Mumbai branch of the Directorate of Enforcement (ED) has recently executed a provisional attachment of significant value in connection with a major financial misappropriation case involving the Punjab & Maharashtra Co-operative Bank (PMC). The properties attached include the 2nd, 3rd, 4th, and 5th floors of Hotel One Continent, located on King Koti Road, Sultan Bazaar, Abids, Hyderabad, collectively valued at approximately 43.84 Crore INR. This action is part of the ED’s efforts under the Prevention of Money Laundering Act (PMLA), 2002, to address and mitigate the effects of a bank loan fraud scheme that severely impacted PMC.
The initiation of the ED’s investigation was based on a complaint filed by PMC against several individuals, including Joy Thomas and Waryam Singh, directors of PMC Bank, along with Rakesh Kumar Wadhawan, Sarang Wadhawan, and other unidentified parties. The allegations centered around a fraud committed by M/s Housing Development & Infrastructure Pvt Ltd (HDIL) and its associates, which resulted in a financial detriment of 6117.93 Crore INR (with principal and interest components of 2540.92 Crore INR and 3577.01 Crore INR, respectively) to PMC.
Through meticulous investigation and the examination of HDIL Group’s banking activities, the ED discovered illicit financial transactions between 2006 and 2014. The promoters of HDIL were found to have diverted funds amounting to 43.84 Crore INR to entities based in Hyderabad, namely M/s My Palace Mutually Aided Cooperative Housing Society & M/s Anish Construct. These transactions, executed by Rakesh Wadhwan, were misrepresented as legitimate business operations while keeping PMC Bank uninformed. As a result, assets belonging to Shri Shripad Deshpande’s Group of Companies of the said value have been provisionally seized under the PMLA.
Previously, on October 17, 2019, key figures in the scam, Rakesh Kumar Wadhwan and his son Sarang Wadhwan, were arrested on charges of money laundering and are presently in judicial custody. Legal proceedings against them, including a prosecution complaint and two supplementary complaints involving 36 other individuals/entities, have been initiated. To date, the ED has secured assets totaling 719.11 Crore INR under the PMLA, 2002, as part of its ongoing campaign against financial fraud and corruption. Further investigations are actively continuing to bring all involved parties to justice and recover the lost funds.
