The Directorate of Enforcement (ED) conducted searches under the PMLA, 2002 at six premises in Thrissur, Kerala, belonging to M/s Manappuram Finance Limited and its Managing Director V.P. Nandakumar as part of an investigation under the PMLA, 2002 into allegations of money laundering from the illegal collection of public deposits.
ED searches turned up evidence of money laundering and large-scale cash transactions in the guise of public deposits carried out by V.P. Nandakumar through his private entity, Manappuram Agro Farms (MAGRO), without RBI licence. He unlawfully collected deposits at several branch offices of M/s Manappuram Finance Limited (MFL), a publicly traded company, through some of its employees.
The outstanding unlawfully obtained deposits, or Proceeds of Crime, have been discovered to be Rs 143 Crore. When the RBI discovered this and ordered the accused to restore the money to the depositors, the accused claimed that they had done so, but an ED inquiry found that there was no documentation of repayment and no KYC of the depositors. Furthermore, Rs 53 Crore in deposits is stated to have been repaid in cash, despite the lack of proof of repayment or KYC.
During the course of the investigation, it was discovered that V.P. Nandakumar diverted and invested the proceeds of crime into immovable properties in the names of himself, his spouse, and his children, as well as shares in M/s Manappuram Finance Ltd. As a result, the ED has frozen V.P. Nandakumar’s assets totalling Rs 143 Crore under the PMLA, 2002. The assets frozen include eight bank accounts, investments in listed shares, and M/s Manappuram Finance Limited shares. Various damning documents proving money laundering, as well as property paperwork for 60 immovable properties, were also confiscated during the search for further investigation.
The involvement of M/s Manappuram Finance Limited’s CFO and other employees accused of assisting in money laundering is being examined. More research is being conducted.
