Rs 27,000 cr bank loan fraud: ED attaches biz group's land, shares, and farm houses unde PMLA

Sept. 7, 2024, 1:06 p.m.

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Indian authorities have seized assets valued at over Rs 5,000 crore under the anti-money laundering law in connection with an alleged banking fraud involving Amtek Group, a now-insolvent automotive equipment manufacturer, the Enforcement Directorate announced on Saturday (September 7).

The IDBI Bank and Bank of Maharashtra had filed a complaint with the Central Bureau of Investigation (CBI), accusing the group of “illegally diverting” bank loans and causing significant losses to the lenders. According to the ED, the fraud is estimated at around Rs 27,000 crore.

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Several Amtek Group companies, including Amtek Auto Limited, ARG Limited, ACIL Limited, Metalyst Forging Limited, and Castex Technologies Limited, went into insolvency, resulting in an “80 per cent haircut” for banks, causing substantial losses to public sector lenders.

Investigations revealed that the group had “deceitfully manipulated” its financial statements to obtain fraudulent loans and create fake assets and investments.

In June, ED searches uncovered a complex network of over 500 shell companies used by the group to hold and invest in high-value real estate and luxury properties, with their ownership concealed through a “highly complex shareholding structure.”

The ED’s statement said these shell companies held assets whose beneficial ownership was linked to Dham, who was found to be alienating or transferring these properties.

Multiple assets attached

The ED initiated the case against the company and its promoters under the Prevention of Money Laundering Act (PMLA), based on a CBI FIR and a directive from the Supreme Court issued in February.

Under a provisional order issued under the PMLA, 85 immovable properties, valued at Rs 2,674.75 crore, were subject to attachment. These assets comprised commercial properties and farmhouses in Delhi, 200 hectares of land in Maharashtra, and extensive tracts of land in Haryana and Punjab, including prime locations in Gurugram, Chandigarh, Rewari, and Panchkula.

Beyond real estate, the seized assets encompassed shares valued at Rs 2,353.46 crore in both publicly traded and privately held companies. These companies included Alliance Integrated Metaliks Limited, Newtime Infrastructure Limited, Rollatainers Limited, and Barista Coffee Company Limited. Additionally, authorities confiscated debentures worth Rs 87.10 crore, resulting in a total value of attached assets reaching Rs 5,115.31 crore, according to the ED.

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