The Enforcement Directorate (ED) has frozen assets worth Rs 143 crore including eight bank accounts after searching six premises of Manappuram Finance Limited and its Managing Director, VP Nandakumar, in Kerala’s Thrissur as part of its investigation into alleged illegal collection of funds from the public and money laundering.
The ED claimed that the searches resulted in the detection of evidence that the proceeds of crime have been invested in immovable properties by Nandakumar in the names of his family members and shares of Manappuram Finance.
The evidence shows large-scale cash transactions in the form of public deposits, by Nandakumar through his proprietary firm, Manappuram Agro Farms (MAGRO), without the RBI’s approval.
The deposits were illegally collected by him at various branch offices of Manappuram Finance Limited (MFL), a publicly listed company, through its employees.
When the RBI detected the violations, it directed the firm to return the amount to the depositors. The accused told the RBI that the money had been returned to the depositors but the ED’s investigation revealed that there is no proof of repayment or KYC details of depositors.
Deposits amounting to Rs 53 crore are shown to have been returned in cash with no proof of repayment or KYC, the financial probe agency said.
“During the course of the searches, it was found that the proceeds of the crime were diverted and invested by VP Nandakumar into immovable properties in the names of himself, his spouse and children and into the shares of Manappuram Finance Ltd. Hence, his assets, totalling to Rs 143 crore, were frozen under the Prevention of Money Laundering Act (PMLA),” the ED added.
The frozen assets include eight bank accounts, investment in listed shares and shares of Manappuram Finance Limited. In addition, various incriminating documents, which are evidence of money laundering, and documents of 60 immovable properties were also seized during the searches.
The role of the chief financial officer of Manappuram Finance Limited and other employees who are suspected to have assisted in laundering the money is being investigated.
