The ABG Shipyard Ltd was under the investigation by AML Watchdog ED that was involved in the money laundering case.
WHAT IS MONEY LAUNDERING?
Money laundering is a process that criminals use in an attempt to hide the illegal source of their income. By passing money through complex transfers and transactions, or through a series of businesses, the money is “cleaned” of its illegitimate origin and made to appear as legitimate business profits.
There are three steps in Money Laundering:
- Placement
- Layering
- Integration
In most of the cases all the three cases won’t be present in money laundering. The will be times where all the three stages are combined, several stages may repeat several times. Money Mules comes in existence at the time when illegal money laundering activities takes place.
ABG Shipyard Ltd
ABG Shipyard Ltd is a part of the ABG Group of companies with diversified business interests. Established in 1985, it is headquartered in Mumbai. It has shipbuilding operations in Surat and Dahej in Gujarat. Following its acquisition of Western India Shipyard Limited in October 2010, it operates a ship repair unit in Goa which is the largest ship maintenance facility in India.
WHAT IS DIRECTORATE OF ENFORECEMENT?
The Directorate of Enforcement is a multi-disciplinary organization mandated with investigation of offence of money laundering and violations of foreign exchange laws. The statutory functions of the Directorate include enforcement of the following: Prevention of Money Laundering Act,2002, Foreign Exchange Management Act,1999, Fugitive Economic Offenders Act,2018, Foreign Exchange Regulation Act,1973 and Sponsoring agency under COFEPOSA.
ABOUT ABG Shipyard Ltd CASE
Money laundering investigation was initiated by ED on the basis of FIR registered by CBI, Delhi on 07/02/2022 against ABG Shipyard Limited and others. ED attached assets worth Rs. 2747.69 crore in this case. The attached assets include Shipyard at surat and Dahej located in Gujarat, agricultural lands and plots, various commercial and residential premises in Gujarat and Maharashtra and bank accounts owned by ABG Shipyard Ltd., group companies and other related entities.
Investigation revealed that ABG Shipyard Ltd. and its Chairman and Managing Director Rishi Kamlesh Agarwal availed various credit facilities from group of banks led by ICICI Bank, Mumbai on giving an excuse of meeting its capital requirements and other business expenses. But ABG Shipyard Ltd. misappropriated the credit facilities and diverted the funds for the purposes other than actual case to various entities in India and abroad, that caused monetary loss to banks of Rs. 22842 crores.
ED traced movable and immovable assets totaling Rs. 2747.69 crore belonging to ABG Shipyard Ltd., group companies, Bermaco Energy Systems Ltd., Dhananjay Datar, Savita Dhanajay Datar, Krishna Gopal Toshniwal, Viren Ahuja and attached the same under PMLA,2002.
