Mumbai: The Enforcement Directorate on Tuesday arrested CFO Anil Khandelwal and internal auditor Naresh Jain of Cox and Kings -- a global tours and travel company -- in a money laundering case linked with their ongoing Yes Bank probe.
On March 8 this year, the ED had arrested Yes Bank’s founder Rana Kapoor, who is in judicial custody. The agency has been since scanning the bank’s transactions with its customers.
These investigations have revealed that Yes Bank has a total outstanding of Rs 3,642 crores in respect of Cox & Kings. More important, CKG forged its consolidated financials by manipulating the balance sheets of overseas subsidiaries. In addition, some board resolutions submitted to banks for sanctioning the loans were also found to be forged.
The loan sanction from Yes Bank was driven by Kapoor and given after bypassing norms. “The ED has gathered evidence that there were clear instruction from Kapoor to the concerned bank officials to allow the said loan to continue and not to make efforts to recover it,” the agency said, after the arrests.
A special Prevention of Money Laundering Act court remanded the duo to ED’s custody for seven days on Tuesday. Investigation also revealed that during the financial year 2015 to 2019 sales of Rs 3908 crore were made to 15 bogus customers. Most of the collection shown in ledgers from Ezeego (another group entity of Cox and Kings) was not found in the bank statements.
There are fictitious 15 high-value debtors reflected in the books of accounts; another 147 sets of customers appear to be suspicious and non-existent, the agency has said.
The Cox and King Limited diverted Rs 1100 crore to another stressed company without approval of the board which has no business relationship with that company; during the entire process, Khandelwal and Jain acquired the mortgaged property amounting to Rs. 63 crore in their own business entity – M/s Reward Business Solutions – without paying a penny from their pocket, the agency adds.
Khandelwal and Jain purchased various immovable properties from the funds diverted from CKG. Further investigation revealed that from Ezeego, Rs 150 crore were diverted to Redkite Capital Private Limited which was promoted by family members of Khandelwa and Jain.
Investigations have revealed that the bank transactions of Cox and Kings are not matching with the books of accounts. Khandelwal and Jain are accused of creating disparities between the books of accounts and the bank statements to camouflage the fraud. The travel company was sent to bankruptcy court last year in October, after it defaulted on payments to the bank.
The ED had initiated investigation under PMLA against Kapoor and others on the basis of FIR registered by the Central Bureau of Investigation.