Former IL&FS CEO Ramesh Bawa arrested by SFIOhttps://indianexpress.com/article/india/former-ilfs-ceo-ramesh-bawa-arrested-by-serious-fraud-probe-office-5673652/

Former IL&FS CEO Ramesh Bawa arrested by SFIO

The IL&FS Group with total liabilities of Rs 94,000 crore has come under the scanner of the Enforcement Directorate for alleged money laundering.

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According to the agency, IL&FS Financial Services Ltd had borrowings of more than Rs 17,000 crore from debt instruments and bank loans.

The Serious Fraud Investigation Office (SFIO) on Saturday arrested former Infrastructure Leasing & Finance Services Ltd (IL&FS) former managing director and CEO Ramesh C Bawa in connection with the alleged irregularities that have resulted into a default crisis at the company. Bawa was arrested in the national capital. This is the second arrest in the case.

Bawa was arrested on the grounds of abusing his powers in IL&FS Financial Services Ltd. through his fraudulent conduct and in granting loans to entities which were not creditworthy and caused wrongful loss to the company and its creditors.

Last week, Hari Sankaran, the former chairman and managing director of IL&FS, was arrested by the agency in connection with the ongoing investigations into the financial affairs of the company and its group entities. He was arrested on the grounds of abusing his powers in IL&FS through his fraudulent conduct and in granting loans to entities which were not creditworthy or have been declared Non-Performing Assets and caused wrongful loss to the company and its creditors.

The IL&FS Group with total liabilities of Rs 94,000 crore has come under the scanner of the Enforcement Directorate (ED) for alleged money laundering.

The SFIO had arrested Sankaran under Section 447 of the Companies Act, 2013 which deals with punishment for fraud. A person booked under this section can face a jail term ranging from six months up to ten years, and a monetary penalty.

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According to the agency, IL&FS Financial Services Ltd had borrowings of more than Rs 17,000 crore from debt instruments and bank loans. Provident funds, pension funds, gratuity funds, mutual funds, public and private sector banks are among those who have invested in these debt instruments, the SFIO said.

The crisis at IL&FS was triggered when IL&FS Transportation Networks delayed repayment of Rs 450 crore of inter-corporate deposits from Small Industries Development Bank of India (SIDBI) in July 2018.