Mumbai, March 8 (IANS) After two days of grilling, Yes Bank founder Rana Kapoor, one of India’s most high profile bankers, was arrested by the Enforcement Directorate (ED) on Sunday in a money laundering case.
A senior ED official told IANS: “Yes, we have arrested Kapoor in a money laundering case.”
Kapoor has been booked under the Prevention of Money Laundering Act (PMLA) and other offences days after the Yes Bank crisis erupted.
The arrest came after Kapoor had been grilled since Friday night for his and his family’s links with the stressed-and-controversial realty firm Dewan Housing Finance Corporation Ltd (DHFL).
A co-founder of Yes Bank in 2003-2004, Kapoor later became its MD and CEO but the banking mogul was forced to exit it in September, 2018.
As part of the probe, ED sleuths raided Kapoor’s home in Samudra Mahal residence Worli.
The ED on Saturday also carried out searches at the residence of Kapoor’s three daughters of at in Mumbai and New Delhi.
The three daughters — Rakhee Kapoor Tandon, Roshni Kapoor and Radha Kapoor, were the alleged beneficiaries of the scam.
The ED suspects that Kapoor and two of his daughters, who are directors with Doit Urban Ventures, allegedly received kickbacks from DHFL.
This amount of Rs 4,450 crore is part of the Rs 13,000 crore allegedly siphoned off by DHFL through 79 dummy companies, with Doit Urban Ventures being one of them.
The ED official said during searches a lot of incriminating documents were found and the agency grilled him on his links with DHFL promoters and other companies.
Kapoor’s alleged role in the disbursal of loan to a corporate entity and kickbacks reportedly received in his wife’s bank account were also under probe.
The ED registered a money laundering case against Kapoor as a continuation of its probe against the DHFL wherein it was allegedly that Rs 12,500 crore was diverted to 80 shell companies using one lakh fake borrowers. The transactions with these shell companies were said to date back to 2015.
An ED official said that the probe revealed that funds diverted by the DHFL originated from Yes Bank.
He said that the searches at Kapoor’s residence on Friday night were meant to find out any irregularity in grant of loans to the DHFL by the Yes Bank.
The ED has accused Kapil and Dheeraj Wadhawan of DHFL of purchasing shares in five firms — Faith Realtors, Marvel Township, Abe Realty, Poseidon Realty, and Random Realtors — after which they were amalgamated with Sunblink.
The outstanding loans of these five firms, totalling around Rs 2,186 crore till July 2019, were allegedly appropriated on to the books of Sunblink to cover up the diversion of loans acquired from DHFL.
The ED’s action comes after the RBI superseded Yes Bank Board for 30 days and appointed an administrator, putting a cap of Rs 50,000 on withdrawal by account holders for a month.
The RBI said that the bank’s board was superseded “owing to serious deterioration in the financial position of the bank”.
Former SBI CFO Prashant Kumar was appointed as administrator of Yes Bank, which has over 1,000 branches and 1,800-plus ATMs across the country.
On Thursday, Union Finance Minister Nirmala Sitharaman said that the bank was under watch since 2017 and developments relating to it were monitored on a day-to-day basis.