ED searches, surveys 15 locations in Mumbai, Nagpur in money laundering case

ED officials said the agency initiated an investigation under relevant sections of the PMLA based on a “predicate FIR” registered at Sitabuldi Police Station in Nagpur.

The case was regarding an alleged fraud causing loss of crores of rupees to investors, said agency officials.

“PMLA investigation revealed that Pankaj Mehadia along with other accomplices were running a Ponzi scheme and lured various investors by promising to give 12 per cent assured profit after deducting TDS on the investments made from the year 2004 to 2017.

“Throughout the period of 2005 to 2016, with the malafide intentions of cheating and siphoning off investors’ money, the accused persons ran the Ponzi scheme giving assured returns to win over the investors and thus luring the investors to invest in larger amounts in the associated firms or companies and ultimately did not return the money,” said ED officials.

“In order to divert the money and to give the transactions a tinge of legitimacy, transactions worth more than Rs 150 crores have been affected in the bank accounts and it is suspected that most of these transactions are not backed by genuine business deals and are in the nature of accommodation entries,” the ED said in an official statement.

The agency added that it has also managed to seize digital devices and various incriminating documents during the searches.

A senior ED official said that further investigation into the case is underway.