ED attaches assets worth over Rs 5,000 crore

(MENAFN- Live Mint) The Enforcement Directorate (ED) on Saturday said assets worth over Rs 5,000 crore have been seized under a money laundering probe in an alleged bank loan fraud case against Amtek Group and others. The insolvent auto component maker is being investigated in an alleged bank fraud case worth Rs 27,000 crore.

Read also | NCLAT orders liquidation of Amtek Auto

In a new development in the banking fraud case, the Edgar Allan Poe has seized farmhouses, hundreds of acres of agricultural and industrial land in several states, as well as shares and debentures in the case against the Amtek group, PTI reported on Saturday, citing the law enforcement agency.

In July, the federal agency arrested Amtek Group founder Arvind Dham. The ED’s investigation revealed that the funds borrowed by the group were diverted and invested in new ventures, real estate and foreign investments.

Read also | BSE, NSE suspend trading in Gitanjali Gems and Amtek Auto

In February, the Supreme Court issued a direction to the authorities to investigate the case. Following the Supreme Court’s intervention, the ED began its investigation based on the Central Bureau of Investigation (CBI) FIR. The ED registered a case under various sections of the Prevention of Money Laundering Act (PMLA).

Amtek Group illegally misappropriated bank loans worth Rs 27,000 crore

IDBI Bank and Bank of Maharashtra are among the major lenders that were exposed to the Amtek Group loan scam. The two banks had earlier filed a CBI complaint against the accused for “illegal misappropriation” of bank loans, the ED said in a statement. According to an earlier Mint report, 19 banks were heavily affected by the Amtek Group. The consortium included IDBI Bank, State Bank of India, Canara Bank, ICICI Bank, etc.

Read also | SBI initiates insolvency proceedings against subsidiary Amtek Auto

Several subsidiaries of the Amtek Group, including Amtek Auto Limited, ARG Limited, ACIL Limited, Metalyst Forging Limited and Castex Technologies Limited, among others, have been declared bankrupt, resulting in a “huge loss” of over 80 percent for the banks and causing “substantial” losses to these state-owned banks, it said.

Amtek Group used a complex network of shell companies to create fictitious assets

The ED’s investigation also found that the group was responsible for “fraudulently manipulating” the financial reports of companies to obtain additional fraudulent loans and create false assets and investments in the books of accounts, news agency PTI reported.

Read also | Liberty House wants to solve problems in Amtek and Adhunik deals

The ED’s searches at several locations revealed a complex network of more than 500 shell companies that owned and invested in valuable real estate and luxury properties. The companies’ shares were hidden in a “highly complex shareholding structure,” it said.

“These shell companies held assets whose beneficial ownership was vested in Arvind Dham, the principal founder and beneficial owner of the Amtek group of companies, and he was found to be disposing of or transferring such assets,” it said.

(With inputs from PTI)

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