The Serious Fraud Investigation Office (SFIO) on Monday arrested former IL&FS chairman Hari Sankaran in connection with the ongoing investigations into the financial affairs of the company and its group entities. He has been sent into SFIO custody till April 04.
Hari Sankaran has been arrested on the grounds of abusing his powers in IL&FS through his fraudulent conduct and in granting loans to entities which were not creditworthy or have been declared Non-Performing Assets and caused wrongful loss to the company and its creditors.
It may be worth noting that IL&FS had borrowings of more than 17,000 crores from debt instruments and bank loans. Provident Funds, Pension Funds, Gratuity Funds, Mutual Funds, Public and Private Sector Banks, are among those who have invested in these debt instruments.
SFIO arrests former chairman of IL&FS, Hari Sankaran for allegedly abusing his powers in IL&FS Financial Services Ltd. for fraudulent conduct and in granting loans to entities which were not creditworthy or had been declared NPA @IndianExpress
— Khushboo Narayan (@khushboo_n) April 1, 2019
Earlier, in a show-cause notice issued to 14 former board directors of IL&FS (IFIN), including former IL&FS chairman Ravi Parthasarathy and Hari Sankaran (former vice chairman of IL&FS), the new management of IL&FS has charged these directors with “facilitating money laundering,” sanctioning loans without any security and “conspiracy and getting unlawful gains,” among others.
The charges include specific instances of directors of a borrower entity, who also happened to be directors of IL&FS group companies, and a case where a large portion of the loan given to a company was later transferred into the account of its directors.