Hyderabad (Agency): The Enforcement Directorate (ED) has arrested T. Venkatram Reddy and P.K. Iyer, promoters of Deccan Chronicle Holdings Private Limited (DCHL), along with the company's auditor Mani Oommen, on charges of money laundering related to a bank fraud case. The arrests were made after the trio reportedly failed to cooperate with the investigation conducted by the agency. They are scheduled to appear before a special Prevention of Money Laundering Act (PMLA) court in Hyderabad on Wednesday.
The ED initiated the arrests based on allegations of money laundering in connection with the bank fraud case. In 2013, a consortium of banks lodged a complaint with the Central Bureau of Investigation (CBI) regarding the nonpayment of loans by DCHL. The CBI subsequently filed a case based on the complaint.
Earlier in February 2015, Venkatram Reddy and his brother T. Vinayak Ravi Reddy, both promoters of DCHL, were arrested by the CBI for allegedly defaulting on a loan of Rs 357 crore obtained from Canara Bank. Venkatram Reddy was later granted bail.
The total alleged loan fraud involving DCHL and its promoters is estimated to be around Rs 8,180 crore, while the initial default amount was approximately Rs 1,500 crore.
The ED commenced its investigation into the money laundering allegations following the CBI's registration of the case. As part of its probe, the central agency provisionally attached assets worth Rs 386 crore belonging to Deccan Chronicle Holdings Limited. These assets consist of 14 properties located in New Delhi, Hyderabad, Chennai, Bangalore, and Gurgaon.
Venkatram Reddy, previously associated with the Indian Premier League team Deccan Chargers, has faced scrutiny regarding the company's fund utilization, including funds related to the IPL team. The promoters of DCHL are accused of manipulating the company's balance sheets, inflating profits and advertisement revenue, and significantly understating the company's financial liabilities. The ED's arrest of the DCHL promoters marks a significant development in the ongoing investigation into the alleged bank fraud case. DCHL promoters have denied any wrong doings.
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