In accordance with the Prevention of Money Laundering Act, 2002 (PMLA), the Directorate of Enforcement (ED) conducted search operations on June 5, 2023, at 7 locations in Bengaluru and Davangere, Karnataka, that belonged to M/s Bharath Infra Exports and Imports Ltd and its related entities in a bank fraud case.
M/s. Bharath Infra Exports and Imports Ltd. accessed loan resources from the State Bank of India, Bengaluru City branch, in the forms of cash credits, EPC/FBD, non-fund-based working capital, and letters of credit (inland and regular). The account of the aforementioned firm was categorised as a Non-Performing Asset (NPA) on January 17, 2017, as a result of unpaid bank debt of 113.38 Crore.
According to the findings of the ED’s investigations, the promoters and directors of M/s. Bharath Infra Exports and Imports Ltd. misappropriated the credit facility obtained from the State Bank of India by improperly diverting money or loans to related parties, submitting forged or fabricated invoices and documents to the bank, and writing off sales that were booked without adhering to contractual obligations.
The investigation further revealed that the accused syphoned off Rs. 101.18 Crore in connection with 10 Letters of Credit issued to M/s. Aradhya Wire Ropes Pvt. Ltd. This money then devolved and was credited into the company’s bank account, and the proceeds of the crime were then transferred through the bank accounts of numerous other entities. Payments were often paid to a transport company and its agents, who had given fictitious invoices and vehicle information to M/s Bharat Infra Exports and Imports Pvt Ltd and M/s Aradhaya Wire Ropes Pvt Ltd without any material actually moving on the job site.
Immovable property estimated to be worth $100,000,000 was discovered during the search operation, and $14.5 lakh in cash was confiscated. Additionally, the alleged entities’ bank accounts, digital devices, and damning papers were also blocked and confiscated. A second PMLA inquiry is currently being conducted.
