On July 12, 2022, the Indian AML watchdog Directorate of Enforcement (ED) made four arrests in relation to the Surana Group of Companies, situated in Chennai, bank fraud cases totalling more than Rs 3986 crore. Dinesh Chand Surana, Managing Director and Promoter of M/s Surana Industries Limited, M/s Surana Power Ltd., and Promoter of Surana Corporation Ltd.; Vijay Raj Surana, Managing Director and Promoter of M/s Surana Corporation Limited as well as a promoter of M/s Surana Industries Limited & M/s Surana Power Limited; and P Anand and I Prabhakaran, the fictitious directors
A money laundering investigation was started by the ED based on three FIRs filed by the Central Bureau of Investigation, BF&SB, Bengaluru, alleging that the three companies, together with their Promoters, Managing Director/Directors, and unnamed people, participated in misappropriation, criminal breach of trust, manipulation of books of accounts through fictional corporations, routed money through shell companies, and syphoned off the money from the business.
According to the ED investigation, these people established a network of phoney firms, whose false directors were either members of the Surana family, people from their ancestral town, or employees of Surana group companies. These dummy/shell businesses served as a conduit for the three major group firms’ transactions, after which the funds were diverted for other uses including stacking real estate purchases and acquiring benami assets in the names of those shell companies.
The investigation also showed that the Surana Group of Companies/Promoters had several companies registered in the British Virgin Islands (BVI) and Cayman Island in the names of fictitious directors, and had diverted funds to park in those companies through four fictitious companies based in Singapore. These enterprises, which are domiciled in Singapore, gained money by marketing goods that Indian exporters sold. However, the receivables have already been eliminated from the Indian businesses’ accounting records.
Further investigation found that thousands of rupees had been moved from the three major group firms to the mentioned shell companies, and from the mentioned shell companies to the promoters’ and their spouses’ accounts. The primary offender of this money-laundering scam is Dinesh Chand Surana, and he actively controlled all of the shell firms. The operations involving the shell businesses, which were nothing more than account manipulation, as well as the layering and other activities were all endorsed by Vijay Raj Surana. P Anand and I Prabhakaran, directors of these shell companies, deliberately colluded with the Surana Management to steal money, aiding and abetting them in their activities of stealing and laundering public cash.
The four people who had been detained were all brought before the Principal Session Judge Court in Chennai, where the honourable court extended their 14-day detention. i.e., till July 27, 2022. The probe is being expanded upon.
