THE ENFORCEMENT Directorate (ED) on Tuesday arrested the chief financial officer and internal auditor of Cox and Kings Group in connection with the Yes Bank money laundering case. Anil Khandelwal, the CFO, and Naresh Jain, the internal auditor of the travel firm, were produced before the special court in Mumbai, which sent them to ED’s custody for seven days.
In August, ED had conducted searches at the residences of Khandelwal and Jain, claiming that it had found alleged irregularities in relation to the loan sanctioned to the group by Yes Bank. The ED also claimed that a forensic audit of the transactions of the group did not match their books of accounts alleging that Khandelwal and Jain had created “disparities between the books of accounts and the bank statements” to camouflage the alleged fraud.
While seeking their custody before the special court, the ED claimed that its investigation in the Yes Bank case — where its founder Rana Kapoor is behind bars — it had surfaced that the bank had total outstanding of Rs 3,642 crore in Cox and Kings Group of companies. It claimed that the sanction of the loan was done through Kapoor by bypassing norms.
“ED gathered the evidence regarding clear instruction of Rana Kapoor to the concerned bank officials to get the said loan continued and not to take efforts to recover it,” it said. It also claimed that between the financial years 2015-2019, sales of Rs 3,908 crore was made to 15 “non-existent/fictitious” customers.
The ED further claimed that the group had forged its consolidated financials by manipulating the balance sheets of its overseas subsidiaries. The ED also told the court that the probe showed that there was forgery in some board resolutions submitted to the banks for sanction of loans.
With regard to the alleged role of Khandelwal and Jain, the ED claimed that the two acquired mortgaged property amounting to Rs 63 crore in their business entity Reward Business Solutions without making any payment on their own. The ED claims the two also purchased various immovable properties from funds of the Group and had diverted money to a firm promoted by their family members. The two denied the allegations.
Yes Bank had filed a complaint against the group in March after which the ED had summoned various officials for questioning.
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