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Govt cracks down on shell companies with Chinese links, arrests mastermind

Mastermind of a racket linked to shell companies arrested

In a major development, the government arrested the chief operator and mastermind in charge of setting up of Chinese shell companies in India.

The person identified as Dortse has been facilitating incorporation of a large number of shell companies that have Chinese links in India and providing dummy Directors on their Boards, SFIO said.

The Serious Fraud Investigation Office (SFIO) under the aegis of the Ministry of Corporate Affairs, conducted multiple raids and searches at the offices of Jillian Consultants India Private Ltd, a wholly owned subsidiary of Jilian Hong Kong Ltd., at Gurgaon, Fininty Pvt Ltd at Bangalore and Husys Consulting Ltd, an erstwhile listed company at Hyderabad.

According to an official press release, Dortse was attempting to flee India. Based on inputs and the investigations carried out, it has been established that Dortse fled already from Delhi NCR to a remote place in Bihar and was attempting to escape India through the road route.

Also read: Delhi Fintech firm owned by Cayman Island group siphons Rs 500 crore black money to shell entities abroad

Evidence procured by the SFIO during the enquiry points to dummy directors being paid by Jilian India Ltd. to act as dummies in several shell companies. Boxes filled with company seals and digital signatures of dummy directors have been recovered from the site, the statement said, adding that many Indian employees were in touch with the Chinese counterparts through a Chinese instant messaging app — Husys Ltd. They were also found to be acting on behalf of Jilian India Ltd..

As per records, as of 2021, there were more than 2.3 lakh shell companies operating in India. “However, it is even more crucial to crack down on these shell companies which have international links as they could pose a threat to security within the country,” an insider said.

He added that the priority would now be to crack down on shell companies which have Chinese links.