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TRS MLA questioned by ED in FEMA case

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The Enforcement Directorate (ED) on Tuesday questioned Telangana Rashtra Samithi (TRS) MLA Manchireddy Kishan Reddy in connection with a case of alleged violation of Foreign Exchange Management Act (FEMA).

The ruling party MLA appeared before the ED officials at the agency’s regional office in Hyderabad.

Kishan Reddy is a member of Telangana Legislative Assembly from Ibrahimpatnam constituency near Hyderabad. He is also the president of Rangareddy district unit of the TRS.

According to sources, the MLA was booked by the ED for violating FEMA. He was served notice by the ED on Monday directing him to appear before it for questioning.

Kishan Reddy was grilled by the ED officials. He was reportedly questioned about his bank transactions.

Kishan Reddy, one of the important leaders of the ruling party, has been playing an active role for the ruling party in its campaign for upcoming by-election to Munugode Assembly constituency.

Meanwhile, former MLA and Congress leader Malreddy Ranga Reddy has demanded that Kishan Reddy should be arrested and strict action should be taken against him as per law. He claimed that Kishan Reddy’s wrongdoings were coming to light one after the other.

Ranga Reddy alleged that the TRS MLA encroached upon the lands of Dalits and poor and sent crores of rupees abroad. The Congress leader also claimed that Kishan Reddy was also involved in playing casinos.

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ED to close Tollywood drugs case citing ‘no evidence’!

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The Enforcement Directorate has reportedly decided to close the sensational Tollywood drugs case that came to light in 2017 after Telangana Excise department has registered 12 cases and arrested about 50 persons including key accused Kelvin and others.

The ED investigated whether Tollywood actors, directors, producers resorted to money laundering in the drugs case.

The ED summoned as many as 12 Tollywood personalities in September and October this year for investigation.

It examined the bank accounts of Tollywood personalities to detect whether they have diverted funds from their accounts to drug peddlers to purchase drugs.

The ED called producer-director Puri Jagannadh, actors Ravi Teja, Tarun, Navdeep, actress Charmee among others for questioning.

However, the ED reportedly did not find any evidence against Tollywood personalities of indulging in money laundering in drugs case.

For this reason, the ED has reportedly decided to close this case and file a chargesheet in the court stating that there was no evidence that Tollywood personalities indulged in money laundering.

The ED already gave a clean chit to Tollywood personalities earlier stating that there was no evidence that they consumed drugs after collecting their nail and hair samples and sent for forensic tests

The forensic tests reportedly found that they have not consumed drugs or narcotic substances.

Against this backdrop, the Tollywood drugs case is all set to be closed completely after four years.

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ED freezes Karvy shares held by its top honchos

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In further action against Karvy Stock Broking Limited (KSBL), the Enforcement Directorate (ED) has issued freezing order in respect of shares of the group held directly & indirectly by the Chairman and Managing Director of M/s KSBL, Comandur Parthasarathy, his sons, Rajat Parthasarathy and Adhiraj Parthasarathy, and their entities in order to safeguard the proceeds of the crime.

The development comes in the wake of search operations on Wednesday at six locations connected to M/s Karvy Stock Broking Limited (M/s KSBL) under PMLA 2002.

The ED had conducted search operations on various premises of Karvy Group of Companies, connected entities and at the residential premises of C. Parathasarathy. During the course of search, several incriminating evidences in the form of property documents, personal diaries, electronic devices, email dumps, etc have been seized & are being analyzed, ED officials stated on Saturday.

It is reliably learnt that C. Parthasarathy is trying to off-load his shares in the group companies through private deals and thus, in order to preserve the proceeds of crime till further investigation, ED has issued a Freezing Order dated 24/09/2021 under PMLA 2002, and the estimated value of these shares has been arrived at Rs 700 crore as per the valuation for the year 2019-20, the ED officials stated.

It may be noted that ED had initiated money laundering investigation on the basis of FIRs registered by Telangana Police on the complaint of HDFC Bank alleging that M/s KSBL had illegally pledged the securities of its clients and taken a loan of Rs 329 crore and diverted the same.

Another FIR has been registered by Central Crime Station, Hyderabad Police, for defrauding IndusInd Bank to the tune of Rs 137 crore and one more FIR has been registered by the Cyberabad Police, Hyderabad, for defrauding ICICI Bank to the tune of Rs 562.5 crore.

KSBL under the leadership of C. Parthasarathy had committed gross irregularities and all the illegally taken loans have become NPA. It is learnt that more FIRs are being registered by other banks and also individual shareholders/investors. The total loan proceeds taken from multiple banks using the same modus operandi is around Rs 2,873 crore, a statement issued by ED on Saturday said.

NSE and SEBI are also investigating the affairs of KSBL. The ED is conducting investigation under PMLA against Karvy Group of Companies for their involvement in the offence of money laundering to the tune of Rs 2,873 crore.

During the course of investigation, it came to light that KSBL did not report the Depository Participatory DP account no 11458979, named KARVY STOCK BROKING LTD (BSE) in the filings made from January, 2019 to August, 2019 with regulators/ exchanges.

Further, KSBL fraudulently transferred shares belonging to its clients to its own demat account (which is not disclosed to the exchanges) and pledged the shares held in these accounts with the lenders/banks (HDFC bank, ICICI bank, IndusInd bank, Axis Bank, etc). The securities lying in the aforesaid DP account of KSBL, actually belonged to the clients who are the legitimate owners of the pledged securities. Therefore, KSBL did not have any legal right to create a pledge on these securities and generate funds. The quantum of such loans taken by KSBL from illegal pledge of shares is to the tune of Rs 2,873 crore. KSBL credited the funds raised by pledging of client securities to 6 of its own bank accounts (“Stock Broker-own Account”) instead of the “Stock Broker-Client Account” and further has not reported these 6 own bank accounts (“Stock Broker-own Account”) held with various private banks, to the SEBI. Prima facie, a net amount of Rs 1,096 crore was transferred by KSBL to its group company i.e. M/s Karvy Realty (India) Ltd (KRIL), from 01-April 2016 to 19-October-2019.

Further, KSBL did large scale trading activities in the name of 9 companies that included M/s Karvy Consultants Limited (KCL), which is a group company of Karvy, and 8 other shell companies, in the guise of doing insurance business. During the course of investigation conducted under PMLA, it also came to light that several crores of rupees were diverted for acquiring immovable properties through the group company, KRIL, and to other group companies as well.

It also came to light that recently deletion of files and emails from the computer servers by using anti-forensic tools had been done, under the instructions of C. Parthasarathy. The bank statement analysis of these companies revealed that there is large value rotation of funds between the Karvy Group of Companies and the shell companies’ bank accounts. Earlier, the ED had recorded the statement of C. Parthasarathy in Chanchalguda Jail.

Further investigation is in progress.

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New twist to Amaravati insider trading: PMLA case booked

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Giving a new twist to the ‘insider trading’ issue in Amaravati capital region, the Enforcement Directorate (ED) on Monday filed a case under the Prevention of Money Laundering Act over irregularities in the purchase of lands in the Amaravati capital region.

This follows AP CID writing to the ED urging it to file a case in regard to irregularities committed by certain individuals over purchase of lands.

The CID investigation detected that 790 white ration card holders had purchased high value lands in the core Capital area who don’t have PAN number.

YSRCP has been charging the previous TDP government of resorting to ‘insider trading’ by leaking the details of Capital location to help its supporters buy lands in the selected area. The YSRCP government has also made public the names of TDP leaders and their supporters who had purchased lands in the core Capital area.

It has also declared the extent of lands purchased by individuals and other details like whether they have PAN cards, white ration cards and if they have been filing I-T returns.

Noted persons named by the YSRCP government in the scam were Kambhampati Rammohan Rao, Prattipati Pulla Rao, Dhulipalla Narendra, Paritala Sriram, Nara Lokesh and P Narayana.

Earlier, CB-CID had registered cases against Narayana and Prattipati Pulla Rao.

The YSRCP is alleging that the suspects who bought lands were the benamis of some bigwigs having links with the previous TDP government.

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Jagan gets another blow in court: ED cases

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AP CM Jaganmohan Reddy’s plea for personal exemption from court appearances was rejected by the Special Court in Nampally, Hyderabad. This was in connection with the multi-crore ED cases. Already, Jagan plea for such exemption in CBI cases was denied. Despite this, Jagan is avoiding the court appearances saying that he is not able to attend because of his high public office as Chief Minister of Andhra Pradesh. So far, Jagan attended before the court only once ever since he became the CM. Today also, he didn’t attend but his co-accused number 2 Vijayasai Reddy attended the court.

CM Jagan is Number 1 accused in the Rs 43,000 Cr CBI illegal assets cases. The Enforcement Directorate has also booked cases against the AP CM.

In today’s order, the court asked AP CM to compulsorily appear before it in next hearing on January 31. The ED advocates strongly objected to exemption to Jagan Reddy. They said that there was already inordinate delay because of too many petitions being filed by Jagan to prevent proper court trials.

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ED case against Ex MP Rayapati: Transtroy violations

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The Enforcement Directorate (ED) has filed a fresh case against senior TDP leader and Ex MP Rayapati Sambasiva Rao on the charges of large scale illegal money transfers to foreign countries. The Central Bureau of Investigation(CBI) has already filed cases against Rayapati on the issue of transfer of Rs 16 Cr through Transtroy company to Singapore, Malaysia and other countries. This amounted to violation of the Foreign Exchange Management Act (FEMA). The Rayapati family had taken over Rs 8,800 Cr from 15 banks for Transtroy company works. The CBI is suspecting that Rayapati might have transferred nearly Rs. 3,800 Cr to foreign countries illegally.

The Rayapati family has already reacted saying that the CBI has registered false cases against them. Considering politically now, there are no serious differences between TDP and BJP. Moreover, the BJP is no longer actively targetting to win over TDP leaders. But there are rumours that the Modi government is sending strong signals of serious action against economic offences. The top level contractors and leaders are in hit list of CBI and ED for quite some time. The day is not far when the CBI and ED will once again crack their whip on the ruling YCP leaders in AP. It may be recalled how CM Jaganmohan Reddy and his Number 2 Vijayasai Reddy have served 16 months in jail even before their trial in the CBI Rs 43,000 Cr illegal assets cases.

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Karnataka Congress leader Shivakumar appears before ED again

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Former Karnataka Minister and senior Congress leader D.K. Shivakumar on Saturday appeared before the Enforcement Directorate (ED) for questioning for the second consecutive day in a money laundering case.

Shivakumar was questioned for over five hours on Friday by the ED as he deposed before the agency in the evening.

The Karnataka High Court on Friday rejected Shivakumar’s petition for interim protection from arrest by the financial probe agency.

The ED had issued the summons on Thursday night, asking Shivakumar to appear before it on Friday afternoon over his alleged involvement in ‘hawala’ transactions in violation of the Prevention of Money Laundering Act (PMLA), 2002.

According to ED sources, Shivakumar was questioned about an amount of Rs 8.59 crore seized during Income Tax department raids in August 2017.

Shivakumar has been on the radar of the I-T department and the ED since demonetisation in 2016.

The alleged money laundering came to light after I-T sleuths raided Shivakumar’s flat in New Delhi on August 2, 2017 which led to the seizure of unaccounted cash to the tune of Rs 8.59 crore without any evidence about its source.

Cases were filed against him and four of his associates under Sections 277 and 278 of the Income Tax Act, 1961, and Sections 120(B), 193 and 199 of the Indian Penal Code (IPC).

Shivakumar has accused Karnataka Chief Minister B.S. Yediyurappa of indulging in vindictive politics by targeting him and other opposition leaders.

Before appearing for questioning before the ED, Shivakumar said, “I am a law-abiding citizen, and I have legal options which I am exploring.”

The Congress leader added that he will face the proceedings “legally, politically and socially”.

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ED chargesheets fugitive Islamic preacher Zakir Naik

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The Enforcement Directorate (ED) has filed charge-sheet against fugitive Indian Islamic preacher Zakir Naik, accusing him of delivering “incriminating” speeches during the peace conferences organised by his Islamic Research Foundation (IRF) in Mumbai during 2007 and 2011, and charged him for money laundering of Rs 193.06 crore.

While filing the charge-sheet, the ED requested the special court for punishment and confiscation of Naik’s attached properties worth Rs 50.46 crore for involvement in money laundering. This is second charge-sheet against Naik, who fled India on July 1, 2016, and is currently living in Malaysia.

The attached properties belonging to Naik include investment in mutual funds, Islamic International School in Chennai, 10 residential flats, three godowns, two buildings and land in Pune and Mumbai, and 10 bank accounts worth Rs 50.46 crore.

“Proceeds of crime totalling Rs 193.06 crore have been quantified in the case. Other than these attachments, investigation in respect of investments of Zakir Naik in Dubai to ascertain and identify the properties outside the country is under progress,” the ED said.

The ED had initiated an investigation based on the FIR registered by the National Investigation Agency (NIA) against Naik and his associates for his involvement in unlawful activities through his provocative utterances, thus promoting enmity and hatred between different religious groups in India.

The NIA had filed a final charge-sheet in the Special NIA Court in Mumbai on October 26, 2017.

“Investigations revealed that most of the incriminating speeches of Naik were delivered during the peace conferences organised by IRF in Mumbai during 2007-2011. The conferences were planned, organised, funded and promoted by the IRF and people of other religions were openly converted to Islam by Naik,” the ED said.

The agency said that Naik’s inflammatory speeches and lectures have inspired and incited a number of Muslim youths in India to commit unlawful activities and terrorist acts.

“His thoughts created disharmony amongst various faiths and created hatred amongst people. The speeches and lectures were recorded in audio-visual format by Harmony Media Pvt Ltd, Mumbai and thereafter the recordings were edited by it for public viewing.”

Harmony Media forwarded the edited version to Global Broadcasting Corporation (GBC), Dubai and IRF International, UK for further broadcast on Peace TV across the globe, according to the Directorate.

“Further, master DVD of Naik’s speeches were made for further replication and distributed to general public for maximum circulation.”

During the investigation, the ED said, it learnt that IRF received Rs 64.86 crore during 2003-04 to 2016-17, mostly from various dubious and unknown sources.

“Majority of the funds were utilised for organising peace conferences. Provocative speeches were made and religious conversion to Islam were propagated during these peace conferences.”

The IRF received donations in response to the appeals made by Naik during the course of his controversial speeches and thus these donations were proceeds of crime emanating from criminal activity, said the ED, adding that the money trail led to identification of one school building in Chennai valued at Rs 6.2 crore, mutual funds of Rs 9.41 crore and ground floor of a building in Mumbai, and these were provisionally attached.

It also revealed that Rs 49.20 crore was received during 2012-2016 from Naik’s accounts maintained in the United Arab Emirates (UAE) to his personal accounts in India.

“Source of his income in UAE is not known. Naik transferred these funds to India and purchased properties in Mumbai and Pune by layering of funds in the name of his close relatives. He used the funds to the tune of Rs 17.65 crore for purchase of properties.

“In order to disguise the origin of funds and real ownership of properties, the initial payments made from Naik’s accounts were diverted to the accounts of his wife, son and niece and re-routed again for the purpose of making bookings in the name of his family members.”

It further said that several companies were established by Naik in the UK and India by placing his close confidants and relatives as directors to camouflage the diversion of funds received by him and his trust through his “illegal activities” of provocative speeches, and also for propagating hate speeches.

Two persons — Amir Gazdar and Najamuddin Sathak — have also been arrested in connection with this case by the ED.

“Investigation has also revealed that Zakir Naik was also involved in suspicious unaccounted cash transactions. Further investigation is under progress.”

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ED attaches properties of Viceroy Hotels, Hyderabad

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The Enforcement Directorate (ED) on Tuesday said it has attached immovable and movable properties of Viceroy Hotels Ltd., Hyderabad worth Rs 315 crore under the Prevention of Money Laundering Act, 2002 in a bank fraud case.

In a statement issued here, the ED said an investigation under PMLA was initiated on the basis of an FIR registered by CBI, Bangalore against Best & Crompton Engineering Pvt Ltd (BCEPL) and their officials for criminal conspiracy between 2010-2013 to defraud Central Bank of India, Andhra Bank and Corporation Bank.

The total loss caused to the Consortium of banks due to the fraud was to the tune of Rs 364 crores. BCEPL is a part of Sujana Group of Companies.

During PMLA investigation, searches were carried out at various places at Chennai, Delhi, Hyderabad and New Delhi at the residential and business premises of the key officials of BCEPL as well as other companies of Sujana Group.

During these searches, incriminating material including documents and electronic devices were seized.

In the business premises of Sujana Group at Nagarjuna Hills, Punjagutta Hyderabad, 124 rubber stamps of different companies/entities were seized, including the rubber stamps of BCEPL, their Letter of Credit beneficiary companies, sundry debtors and trade associates.

Investigations also revealed that several shell companies were floated and money was circulated among the companies using bogus invoices and part of loan amount was diverted to one Mahal Hotels which is also a shell company floated by the Sujana Group, the ED said.

After circuitous transactions, finally, the amounts were paid to Viceroy Hotels in the guise of Business Transaction Agreement between Viceroy Hotels Ltd and Mahal Hotels Pvt Ltd.

According to ED, Viceroy Hotels, admitted their liability towards Mahal Hotels at Rs 315 crore.

Accordingly, the properties of Viceroy Hotels to the extent of approximately Rs 315 crore were provisionally attached.

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YS Jagan’s assets case: ED attaches land and buildings

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Enforcement Directorate (ED) Hyderabad, has attached 231 Acres of land and part of Hotel Building worth ₹7.85 crores in a case related to YS Jaganmohan Reddy – ED tweeted today.

The property attached under provisions of Prevention of Money Laundering Act (PMLA),2002, belongs to M/S Penna Cement Industries Limited and M/S Pioneer Holiday Resorts Limited. The immovable assets cover the lands belonging to Penna cements in Anatapur district, while the hotel is located in the Banjara Hills area in Hyderabad.

The ED has filed the cases against these companies based on the charge-sheet filed by CBI in jaganmohan Reddy’s disproportionate assets cases, under money laundering Act. The CBI charged that these companies paid bribes to Jaganmohan Reddy in the name of investments for the undue favors they received from state government headed by YS Rajasekhar Reddy, Jagan’s father. These cases are popular as “quid pro quo” cases.

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