Mumbai, October 5, 2026: The Enforcement Directorate (ED) has seized around Rs 21 lakh in cash and several incriminating documents and digital devices during searches conducted as part of its probe into an alleged Rs 200-crore Corporate Social Responsibility (CSR) fund diversion racket involving charitable trusts, CSR agents, intermediaries and shell entities allegedly used to convert accounted corporate funds into unaccounted cash.
The agency, which conducted searches at eight locations across Maharashtra, West Bengal, Gujarat and Delhi-NCR on October 1, is investigating the alleged network in a money laundering case against Dharmendra Kumar Chandradev Singh and others. The ED said its investigation has prima facie revealed that CSR funds received from public sector undertakings (PSUs), public sector banks and private companies were allegedly diverted and recycled through a network of entities.
CSR Funds Under Investigation
According to the ED, at least 40 PSUs and public sector banks across the country had provided CSR donations to charitable trusts operated by Singh. Several projects were allegedly only partially executed or not executed in proportion to the funds received, while vendor bills were allegedly inflated and excess funds routed through bogus or shell entities. Commissions were also allegedly paid to intermediaries who facilitated CSR contributions.
The agency alleged that the mechanism was used to convert accounted corporate funds into unaccounted cash. According to the ED, in the case of private entities, CSR contributions were first routed to the trusts operated by Singh and a substantial portion of the amount was allegedly returned to the original contributors in cash after deducting a small commission. The agency alleged that the arrangement effectively allowed the companies to recover a significant portion of the funds they had shown as CSR expenditure, while the commission was retained for facilitating the transaction.
Network Of Agents And Shell Entities
Searches also revealed a network of CSR agents and intermediaries who allegedly acted as a link between corporate donors and the trusts. These intermediaries allegedly facilitated the movement of CSR funds to the trusts, following which the money was routed through a chain of shell entities controlled by market operators. The agency said the arrangement was used to layer the funds and obscure the trail between the original CSR contributors and the eventual beneficiaries.
According to the agency, most of the entities through which the funds were allegedly routed have also been flagged in multiple GST fraud investigations. The ED said approximately Rs 200 crore in CSR funds was routed through the alleged mechanism.
Public Representatives’ Role Under Lens
Further investigation has revealed that the trusts were projected as vehicles for funding the procurement of high-end medical machinery and equipment for hospitals and healthcare institutions. According to the ED, when such institutions cited lack of funds for procuring the required equipment, they were connected with public representatives of the concerned areas. These representatives allegedly issued recommendations for funding the identified projects specifically through trusts operated by Singh.
The agency said its investigation further revealed that PSUs made CSR donations to these trusts primarily on the strength of such recommendations received from public representatives or their staff. Thus, according to the ED, the recommendations played a significant role in directing CSR funding towards projects proposed to be financed through Singh-operated trusts.
The agency has alleged that commissions were paid to intermediaries facilitating CSR contributions and that inflated vendor bills were used to siphon off excess funds.
Money Laundering Case
The PMLA investigation against Singh and others was initiated on the basis of an FIR registered at Juhu Police Station under provisions of the Maharashtra Medical Practitioners Act, 1961, the National Medical Commission Act, 2019 and the Bharatiya Nyaya Sanhita. The FIR includes offences corresponding to Sections 420, 467, 471 and 475 of the IPC, which are scheduled offences under the PMLA.
According to the ED, Singh had established and operated the charitable trusts through which the CSR funds were allegedly mobilised for healthcare-related projects. The agency has alleged that Singh, who had studied up to Class XII and did not possess a recognised medical qualification or registration with a medical council, represented himself as a doctor and used the title for nearly three decades.
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The ED's investigation is now focused on the alleged fund flow through the trusts operated by Singh, the role of CSR agents and intermediaries, the entities through which the funds were allegedly routed and the beneficiaries of the money. Further investigation is underway.
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