ED alleges siphoning of school, government funds in Rs 645-crore bank fraud
Realtor Vikram Wadhwa received over Rs 70 crore in proceeds of crime, alleges ED
The disclosure came days after the ED arrested real estate businessman Vikram Wadhwa under the Prevention of Money Laundering Act (PMLA) in connection with the case. The Enforcement Directorate (ED) on Monday alleged that funds belonging to two private schools in Chandigarh and Panchkula were siphoned off along with money from bank accounts of the Haryana Government and the Chandigarh Administration in the alleged Rs 645-crore IDFC First Bank fraud case.
In a statement issued on Monday, the agency said its investigation had so far revealed the “embezzlement of Rs 645 crore from bank accounts of the Haryana Government, Chandigarh Administration and two private schools in Chandigarh and Panchkula maintained with IDFC First Bank”.
The disclosure came days after the ED arrested real estate businessman Vikram Wadhwa under the Prevention of Money Laundering Act (PMLA) in connection with the case.
The ED alleged that Wadhwa, in connivance with co-accused Ribhav Rishi, Abhay Kumar, certain bank officials and government officials, was involved in the embezzlement of funds from government and other accounts.
“Vikram Wadhwa has been instrumental in generation, layering and concealment of Proceeds of Crime and he received Proceeds of Crime amounting to more than Rs 70 Crore in his personal account in addition to huge amount of cash generated from embezzled fund,” the agency said.
According to the ED, Wadhwa subsequently invested the alleged proceeds of crime in various entities linked to him and also purchased several immovable properties.
The agency said its probe has identified a network of intermediary shell entities, including Capco Fintech Services, Swastik Desh Projects, R.S. Traders and SRR Planning Gurus Pvt Ltd, which allegedly received embezzled funds directly from accounts of government departments. The money was then layered through multiple bank accounts of accused persons and associated entities, the ED claimed.
The agency further alleged that hundreds of crores of rupees were transferred from these intermediary entities to various jewellers, who allegedly provided cash against the banking transactions.
The agency alleged that “Ribhav Rishi alongwith his associates, further distribute said Cash amount to various Govt Officials and businessmen including Vikram Wadhwa”, adding that efforts are underway to trace the complete money trail and identify other beneficiaries and properties acquired from the alleged proceeds of crime.
In a separate development, the ED on Monday arrested Pushpinder Singh, a former Deputy Vice President of Kotak Mahindra Bank, in connection with the alleged Rs 145-crore fraud involving funds of the Municipal Corporation (MC), Panchkula.
The arrest was made by the ED’s Chandigarh Zonal Unit under provisions of the Prevention of Money Laundering Act in the money laundering investigation linked to the alleged fraud. A Special Court dealing with PMLA cases in Panchkula remanded Singh to ED custody for nine days, till June 9.
According to the ED, the money laundering case stems from an FIR registered by the Anti-Corruption Bureau (ACB), Panchkula, under provisions of the Bharatiya Nyaya Sanhita and the Prevention of Corruption Act against unknown bank officials.
The agency said the FIR pertains to the alleged embezzlement of MC Panchkula funds amounting to Rs 145 crore through a “deep rooted, well-organised criminal conspiracy”.
In its statement, the ED described Pushpinder Singh as the “master-mind of Kotak Mahindra Bank Fraud with Municipal Corporation, Panchkula”.
The ED alleged that its investigation had revealed “a close criminal nexus of Municipal Corporation Official, Bank Officials and Private Persons” who conspired to siphon government funds.
According to the agency, Dileep Kumar Raghav, then Customer Relationship Manager with Kotak Mahindra Bank, along with Pushpinder Singh, then Deputy Vice President of the bank, and Vikas Kaushik, former Senior Accounts Officer of MC Panchkula, allegedly opened two bank accounts in the name of the municipal corporation using “forged and fake authorisation documents”.
The ED further alleged that funds lying in genuine MC Panchkula accounts were transferred to unauthorised accounts using “forged and fake fund migration authorisation letters” purportedly issued on behalf of the civic body.
According to the agency, the diverted funds were routed through financiers, including Rajat Dahra, Swati Tomar, Kapil Kumar and Vinod Kumar. “Investigation has revealed that these financiers were working under the control and directions of Pushpinder Singh,” the ED said.
The agency also alleged that accounts of Rajat Dahra and Swati Tomar, used for siphoning a substantial portion of the municipal funds, were under Pushpinder Singh’s control.
“Further, these funds illegally received by financiers from fake bank accounts maintained in the name of MC, Panchkula were routed back to Pushpinder Singh and Preeti Thakur (wife of Pushpinder Singh),” the ED alleged, adding that part of the funds was transferred to real estate firms and other private persons on Singh’s directions.
Further investigation into both cases is underway, the agency said.
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