ED arrests developer for defrauding foreigners in Goa

Ankit, CEO of Sanatan Financers and Real Estates Private Limited, was arrested under provisions of Prevention of Money Laundering Act. (PMLA).

An ED statement Friday said Ankit and Sunil created shell companies and induced foreigners to invest directly in these entities in return for shares. Since foreign nationals are not allowed to buy property in the country according to provisions of Foreign Exchange Management Act, 1999, the victims were asked to use the Foreign Direct Investment (FDI) route to invest and become major shareholders in the company. Reportedly, none of the victims were ever given any property and ownership of plots of land under the project, named Peace Valley, was also never transferred in their names.

“So in that sense, the plots and investments were in the name of the shell companies which had foreigners as the major shareholders and a tiny fraction of shares held by the father-son duo,” said an ED official.

“Once the foreign nationals invested in these shell companies on the promise that their amount would be used in investments in Goa, the money would then be transferred in the accounts of the company, owned and controlled by Ankit and Sunil. We are still to probe the channel used,” said the official. “The case became messy when they started threatening the foreigners and one of them approached police.”

While FIRs in the case are lodged with Goa Police, ED took it up because of the “systemic risk” it demonstrated, according to an official. For now, ED has got four days’ custody of Ankit and is expected to begin questioning him.