PMC bank case: Enforcement Directorate raids Viva Group, seizes Rs 73 lakh cash

The ED initiated an investigation under the Prevention of Money Laundering Act, 2002. Pic/Hanif Patel

The Enforcement Directorate (ED) on Friday conducted searches at the five premises belonging to Viva Group and its associates. The premises included a registered office of Viva Group in Virar, a residential premise of a concerned person of Viva Group in Virar, one associated office premise of Viva Group in Andheri, and two residential premises of two financial consultants of Viva Group in Juhu, and Chembur respectively.

During the search, Rs 73 lakh cash, incriminating digital and documentary evidence have been recovered The ED initiated an investigation under the Prevention of Money Laundering Act, 2002 (PMLA) against Housing Development Infrastructures Ltd's (HDIL) Rakesh Kumar Wadhawan, Sarang Wadhawan, Waryam Singh and Joy Thomas, chairman and managing director of PMC bank Ltd and others on the basis of an FIR registered by the Economic Offences wing of Mumbai Police.

The FIR was registered under Sections 409, 420, 465, 466, 471 read with 120 B of IPC, 1860 for causing wrongful loss prima facie to the tune of Rs 4,355 crore to PMC Bank and corresponding gain to themselves.

Several properties of Rakesh Kumar Wadhawan and Wadhawan Family trust and others, valued at Rs 293 crore were also attached and jewellery worth Rs 63 crore was seized earlier. A prosecution complaint has been filed against Rakesh Kumar Wadhawan and others under PMLA.

The investigation also revealed that Wadhawans of HDIL in connivance with Viva Group have diverted more than Rs 160 crore from HDIL to many companies/entities belonging to Viva Group in the garb of commission. The Source of these funds from HDIL to Viva group is apparently the illegal fund diversion from PMC Bank.

The ED has also initiated an investigation in another case against Rakesh Wadhawan and Sarang Wadhawan, promoters of HDIL, and others for siphoning off the loan of Rs 200 Crore sanctioned by Yes Bank to one Mack Star Marketing Pvt. Ltd. This loan was siphoned by Wadhawans by showing it for fictitious purposes. In the matter, CBI (ACB), Mumbai, had registered an FIR under Section 120 B, 409, 420 of IPC, 1860 and 13(2) r/w 13(1)(d) of PC Act 1988 against the above-mentioned entities.

During investigation under PMLA, it was revealed that Wadhawans illegally and fraudulently transferred two commercial properties of Mack Star in Kaledonia Building, Andheri East, valued at Rs 34.36 crore to M/s Viva Holding, a company of Viva Group.

For the transfer of the said two properties, 2 separate sale agreements dated June 26, 2017, were prepared, wherein the sale value for both the subject commercial properties was shown as Rs 34.36 crore in total.

In the said sale agreements, the purchase amount was shown to be paid vide 37 cheques by Viva Holding to Mack Star Marketing Pvt. Ltd. against the purchase of the said properties. However, further investigation revealed that these cheques were never en-cashed in the account of Mack Star and Viva Holding never made payments for the purchase of the said property to Mack Star.

The Wadhawans had illegally transferred these properties to Viva Group in violation of the article of association of Mack Star. Further, Viva Holding never showed these properties in its Balance Sheets.