GG News Bureau
New Delhi, 13th Jan. The Enforcement Directorate (ED) arrested five individuals on Friday in connection to a money laundering case involving an alleged bank loan fraud of Rs 56,000 crore. The case is connected to the former Bhushan Steel Limited.
“We have arrested persons; Ajay Mittal (brother-in-law of promoter Neeraj Singal), Archana Mittal (wife of Ajay Mittal and sister of Neeraj Singal), Nittin Johari (then CFO of Bhushan Steel), Pankaj Kumar Tewari (then vice-president, banking) and Pankaj Kumar (then vice-president, accounts),” a spokesperson of the ED said in a statement.
The investigation was started by the ED based on a complaint filed by the Serious Fraud Investigation Office (SFIO) against Bhushan Steel Limited. The SFIO had accused them of committing scheduled offences under the Prevention of Money Laundering Act, 2002.
“The ED investigation revealed that the erstwhile Bhushan Steel Limited (BSL) and its managing director Neeraj Singal and his associates formed several shell companies. They rotated funds from one company to another through a chain of multiple entities. The funds were circulated to infuse capital, buy property and for other personal purposes not intended by the banks,” the spokesperson said.
“Investigations further revealed that promoters/directors and the officials of BSL prepared forged documents and made fraudulent representations before the banks to discount LCs and diverted the funds back into their own companies with malafide intentions. Funds were misappropriated against the fabricated LCs created in favour of JSW Steel Limited and Hindustan Zinc Limited. The misappropriated funds were diverted to other group/associated companies, causing wrongful loss to the State Bank of India and Punjab National Bank,” the spokesperson said.
Earlier, the ED had provisionally attached assets worth Rs 61.38 crore on November 8, 2021. The provisional attachment order was subsequently confirmed by the adjudicating authority on July 24, 2022. “A search operation was conducted for Neeraj Singal on June 9 last year and he was arrested by the ED on the same day. Singal is in judicial custody till date. Prosecution complaint has been filed against him and other accused on August 8, 2023, and cognizance has been taken by the PMLA court concerned on November 7,” the spokesperson added.
He said Ajay Mittal and Archana Mittal both knowingly received proceeds of the crime to the extent of Rs 70 crore.
“They also mortgaged property of BSL and routed the funds to the family of Neeraj Singal. Nittin Johari, Pankaj Kumar Tewari and Pankaj Kumar are former employees of the BSL who were the main persons in charge of accounts and banking transactions,” the spokesperson said.
