Rs 17.5 crore loan fraud: ED seizes Rs 10 lakh, searches firm's 7 premises in Jaipur

Jaipur, Sep 11 (IANS) In fresh action in a Rs 17.5 crore bank loan fraud by a company, the ED conducted searches at seven residential and business premises at Jaipur and seized Rs 10 lakh cash and incriminating documents, said an official on Thursday.

The search operations at the premises of Romesh Power Products Pvt Ltd (RPPPL) – a company which manufactures electric cables - by the Directorate of Enforcement (ED), Jaipur Zonal Office, were carried out on September 9, the official said in a statement.

The searches were carried out in connection with a bank loan fraud case under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, he said.

During the search operations, cash amounting to Rs 10 lakh and various incriminating documents were found and seized. Further, documents related to the diversion of Proceeds of Crime via investment in various properties and Fixed Deposits worth Rs 3 crore were also recovered, said the ED, which also froze some of the company’s bank accounts.

The ED had initiated an investigation against RPPPL and its directors and other persons on the basis of an FIR registered by the CBI, wherein it was alleged that the company and its directors availed a bank loan of Rs 17.5 crore from Bank of Maharashtra; however, it had turned into a non-performing asset.

The ED said the dues of the bank were siphoned off or diverted by the accused company through its directors for personal and related-party gains.

The investigation by the ED and the search operation revealed that RPPPL, which was engaged in the manufacturing and selling of electric cables, fraudulently obtained enhanced credit facilities from Bank of Maharashtra by submitting inflated stock/sales figures and false certificates regarding the issue of bonus shares, certified by a chartered accountant.

The directors diverted funds through unauthorised accounts, depleted hypothecated stocks, and misrepresented material facts in pursuance of a criminal conspiracy, said the ED.

--IANS

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