ED arrests Kanishk Gold’s Jain in Rs 824 crore bank fraud

CHENNAI: The Directorate of Enforcement (ED), Chennai, on Friday

arrested

Chennai jeweller and Kanishk Gold Private Ltd (KGPL) managing director Bhoopesh Kumar Jain under the Prevention of Money Laundering Act.

The ED has been investigating the firm in connection with a conspiracy to defraud a consortium of banks of Rs 824 crore.

“Jain may certainly try to tamper with evidence and records to manipulate the facts in favour of his case,” the ED said in a statement. “...He has neither cooperated with the investigation nor has he revealed any true or factual information so far.”

Jain is in prison, the statement said.

The ED registered a case after a complaint to the CBI by a general manager of State

Bank

of India (SBI), charging KGPL with forgery, cheating and criminal conspiracy. The company obtained huge loans from an SBI-led consortium of 14 banks. KGPL secured the credit against stocks, but the ED later found that the firm had used chartered accountants to fudge the documents. The bank conducted inspections of the firm’s offices in May 2017, and found that its operations had come to a standstill. There was no trace of the stocks against which the company had obtained loans.

The ED had frozen land, buildings, plants and machinery of a KGPL unit in Kancheepuram district, which it valued at Rs 48 crore, in April. The move followed investigations by ED after the CBI registered a case against the company on March 21.

The CBI in March conducted searches of KGPL offices and Jain’s residential properties. On March 22, the agency questioned Jain and his wife Neeta in Bengaluru.

The ED has attached properties of Jain worth Rs 143.58 crore, which it identified as proceeds of crime.

KGPL manufactured and marketed gold jewellery under the brand name ‘Krizz’.

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