Probe Agency Raids Mumbai-Based Group In Rs 975 Crore Bank Loan Fraud Case

Luxury cars like Mercedes Benz and Lexus, and watch brands like Rolex and Hublot apart from more than 140 bank accounts and lockers were seized after the ED raided a Mumbai-based business group in an alleged Rs 975 crore bank loan fraud linked money laundering case.

The searches were undertaken against Mandhana Industries Limited (now GB Global Ltd.) and its promoters on Wednesday, the federal agency said in a statement.

The money laundering case stems from a CBI FIR filed against the company, its directors Purushottam Mandhana, Manish Mandhana, Biharilal Mandhana and others based on a complaint filed by the Bank of Baroda for allegedly defrauding a consortium of banks to the tune of Rs 975.08 crore, according to the statement issued on Thursday.

Mandhana Industries Ltd and its directors "hatched a criminal conspiracy" to cause loss to banks and corresponding wrongful gain to themselves by "diverting" loan funds through fraudulent transactions and circular trading, it said.

The Enforcement Directorate (ED) said the searches led to the unearthing of "crucial incriminating" documents including property documents.

More than 140 bank accounts, five lockers and shares and securities worth Rs 5 crore have been frozen and three high-end cars, including a Lexus and a Mercedes Benz, along with multiple watches of brands like Rolex and Hublot were seized during the raids, the ED said.

"Various fictitious entities were incorporated by the directors of Mandhana Industries Ltd. in the name of employees of the company for layering funds through the bank accounts of such entities.

"Suspicious third-party transactions were made to divert funds to the accounts of promoter/directors and their family members and bogus purchases were booked against payments made to different entities providing accommodation (hawala) entries, it alleged.

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