ED questions actor Dino Morea: What is the alleged multi-crore Mithi river scam?

What are the allegations, and why was Morea questioned? Here is what to know.

What work was the BMC engaging in?

The Mithi river is one of the four rivers flowing through Mumbai, originating from Vihar Lake and Powai Lake and meeting the Arabian Sea (in Mahim). Nearly 18.64 km long, the seasonal river has both residential slum pockets and industrial areas along its banks.

It acts as a natural stormwater drainage channel for Mumbai during the monsoons. However, over the years, the dumping of garbage, sewage, and industrial waste has hampered its flow. After the 2005 Mumbai floods, civic authorities began efforts to clean the riverbed. The BMC was tasked with cleaning an 11.84 km-long stretch, and the remaining area fell under the Mumbai Metropolitan Region Development Authority (MMRDA).

What is the alleged Mithi river scam?

In August 2024, the government announced in the State Legislative Council that a Special Investigation Team (SIT) of Mumbai police’s Economic Offence Wing (EOW) would probe the desilting works, after BJP MLCs raised questions about it.

The SIT started scrutinising the spending of around Rs 1,100 crore between 2005 and 2021. Dozens of contractors, middlemen and BMC officials were questioned, and the SIT on May 6 registered the first FIR against 13 people accused of causing wrongful loss of over Rs 65.54 crore to the civic body. The probe team also carried out raids at seven locations.

The SIT registered an FIR against the BMC Storm Water Drains (SWD) department’s assistant engineer, Prashant Ramugade, two deputy chief engineers, people associated with Matprop Company and Virgo Specialities Pvt Ltd (both providing technical services), Vodar India LLP and a contractor.

The directors of five contractor companies have also been booked. All are accused of financial irregularities related to desilting, transporting and dumping sludge between 2021 and 2023.

How was the alleged fraud committed?

The FIR states that the accused contractors, middlemen and BMC officials conspired to include favourable terms and conditions in the contracts. The accused companies submitted fake Memoranda of Understanding of dumping sites to the SWD division. The officials allegedly accepted the documents for the land where silt was supposed to be dumped without due verification.

The SIT claims that the accused BMC officers aided the contractors, with the SWD department paying Rs 45.50 crore to the contractors between 2013 and 2021, falsely claiming that the sludge was removed.

“Some contracts don’t have proper signatures, some have bogus signatures, in some cases, signatures of owners of (sludge dumping) lands are missing, and in some cases, landowners don’t know that their identities are being misused for bogus contracts. In one instance, they used the name of a landowner who died 20 years ago,” said SIT member EOW DCP Sangramsinh Nishandar.

The SIT has also found that the accused BMC officers pushed to rent machines from a Kerala-based supplier in exchange for wrongful gains, and that the accused BMC officers told contractors to use machinery from certain middlemen.

What irregularities did ED find?

The ED’s investigation is based on the predicate offence (the illegal act through which an unaccounted sum of money is generated) case filed by the EOW. Prima facie, the accused contractors, middlemen, desilting machine companies, and others colluded to form a cartel with the intent to manipulate BMC tenders.

The said action effectively conferred a monopoly and caused payments at inflated rates for desilting works, resulting in undue gains and causing financial loss to the public exchequer. These gains were concealed through certain shell companies/firms.

The amount of silt removal has been repeatedly increased annually, without any scientific investigation, ultimately benefiting the contractors, the EOW stated. It has also impacted the quality of work. Currently, only around 60% of the desilting has been done, with the number as low as 35-40% in some previous years.

Why did ED question actor Dino Morea?

Two accused middlemen, Ketan Kadam, 50, of Vodar India LLP, and Jay Joshi, 49, of Virgo Specialities Pvt Ltd, were arrested last month. Police have also received notes of entries of money received from the contractors, indicating commissions. Morea is reportedly a close associate of Kadam.

According to the probe agencies, Kadam allegedly acted as a middleman for Vodar India Ltd. and has been associated with Morea for 25 years. EOW official sources said there are five to seven monetary transactions worth Rs 14 to 18 lakh between Morea and Kadam. Kadam’s wife and Morea’s brother are also directors in the same company. The SIT probe revolves around these transactions.

Last month, the EOW also questioned Morea and his brother. Probe agencies are trying to ascertain if Morea was acting on any politician’s instructions, but he has not been named as an accused in the case. He is also a close friend of Shiv Sena (UBT) leader Aditya Thackeray, whose party controlled the BMC for over two decades. His questioning also assumes significance as the alleged scam could become a big talking point during the upcoming civic polls, likely to be held in the next four months.