Sushil P Mantri, Director of Bangalore-based real estate company Mantri Developers Private Limited, has been detained by the Directorate of Enforcement (ED) in connection with an ongoing investigation under the Prevention of Money Laundering Act (PMLA), 2002.
Based on an FIR filed against the firm, its directors, and several other workers at Bengaluru’s Subramanyapura Police Station in 2020, the ED launched a money laundering inquiry in March 2022. Many home buyers have reported the accused entities/persons to the police and the ED, alleging that they are engaged in money laundering and have deceived potential buyers with rosy-coloured schemes, misleading brochures, fabricated delivery dates, and window dressing while collecting more than Rs. 1000 Crore in advance payments from thousands of buyers. Even after waiting for seven to ten years, they still do not have ownership of their apartments.
During the examination, it was also discovered that the firm provided a number of buy-back plans that were akin to Ponzi schemes, and advance payments were made for the apartments and mansions. Even after receiving a clear directive from the Real Estate Regulatory Authority, the corporation has in certain instances refused to reimburse the money to the buyers (RERA).
The project stopped as a result of the ED investigation which discovered that the money that had been collected from the customers by the firm and was intended for the building of the projects had been diverted for personal use by the management of the company or other fraudulent reasons. The group now has over Rs. 5000 crores in outstanding loans from several financial institutions, of which approximately Rs. 1000 crore is past due and some of the debts have been classified as NPA. The corporation has cross-collateralized its assets to other financial institutions in order to get numerous loans on the same assets, it was also discovered during the examination.
The Honorable Court has seen Sushil P. Mantri in person and has given ED custody of him for ten days. Further research is now being conducted.
