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ED arrests Yes Bank co-founder Rana Kapoor in a money laundering case

Last year, Rana Kapoor was arrested by ED for allegedly taking kickbacks in lieu of granting loans to several companies including Dewan Housing Finance Corporation Ltd (DHFL) and Cox and Kings Ltd, that have now defaulted on repayments

Written by Khushboo Narayan | Mumbai |
January 27, 2021 6:25:06 pm
Yes Bank founder and former MD and CEO Rana Kapoor. (File photo)

The Enforcement Directorate (ED) Wednesday arrested former chairman and co-founder of Yes Bank Ltd Rana Kapoor under the Prevention of Money Laundering Act (PMLA). Kapoor was arrested in a case pertaining to the alleged sanctioning of a Rs 200 crore loan during his tenure to Mack Star Marketing Pvt, a company owned by the jailed promoters of HDIL – Rakesh and Sarang Wadhawan. The Wadhawans are accused of defrauding the Punjab and Maharashtra Co-operative (PMC) Bank of Rs 6000 crore. A local court has remanded Kapoor to ED custody till January 30.

According to ED, Mack Star got a Rs 200 crore loan “in criminal conspiracy with Rana Kapoor” and then diverted it to HDIL which in turn used the money to settle its loans with Yes Bank. The case against Kapoor is based on the FIR filed by the Central Bureau of Investigation last year. The ED has also alleged that the actual purpose for sanctioning this loan was “to siphon off the amounts and transfer the misappropriated funds to struggling HDIL group companies and it was used to evergreen the accounts of HDIL with Yes Bank to save them from becoming an NPA”.

“The entire circulation of funds was happening within the Yes Bank system (i.e. loans disbursed by Yes Bank into Mack Star’s Yes Bank account were immediately diverted to Yes Bank accounts of HDIL group companies, which used these funds on the same day to discharge liabilities owed by these HDIL group companies to Yes Bank),” said ED.

Last year, Rana Kapoor was arrested by ED for allegedly taking kickbacks in lieu of granting loans to several companies including Dewan Housing Finance Corporation Ltd (DHFL) and Cox and Kings Ltd, that have now defaulted on repayments. Since then, Kapoor was in judicial custody. Earlier this week, the Bombay High Court rejected the bail application of Kapoor in that case.

 

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