In December 2022, the Enforcement Directorate conducted searches at 16 locations across India at the premises of Securekloud, Pro Fin Capital, Quantum Global Securities and two other firms. The operation against money laundering was based on an FIR filed by CBI on Securekloud CEO Suresh Venkatachari's complaint against Quantum Global.
Now the ED has arrested Venkatachari and another promoter RS Ramani under the Prevention of Money Laundering Act.
Had faced SEBI action before
The arrest comes months after Venkatachari and three others were barred by Securities and Exchange Board from associating as Securekloud directors and slapped with a Rs 2 crore fine.
Along with the arrest, Venkatachari has also lost his position as Securekloud president with immediate effect.
The firm also lists Sandeep Tandon, the founder of financial services provider Quantum Group, and his wife among stakeholders.
Despite a presence in India and the US, the valuation of the cloud services firm has plummeted to Rs 133 crore, and its share prices are down 80 per cent from an October 2021 peak.
Been in trouble for a decade
The company which claims to have served Fortune 500 firms, has seen its sales drop from Rs 849 crore to Rs 379 crore, between FY18 and FY22.
The firm had been under SEBI's scanner for manipulative and fraudulent stock trading since 2012 after unusual price fluctuations.
In 2018, Venkatachari legal action against Quantum Global for illegal share transfer.
By 2019, an audit by Deloitte revealed false information and misrepresentation by the firm's management.
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