MUMBAI: Drivers, cleaners made bogus directors of SVLL's shell companies, two more banks lodged complaints

On April 20, Baid, the main accused and mastermind of Rs 836 crore loan fraud scam, was arrested for his role in aiding laundering of tainted money.

The investigations of the Enforcement Directorate (ED) revealed that Roop Chand Baid, promoter and director of Siddhi Vinayak Logistics Ltd (SVLL), leading fleet operator in Surat had made his truck drivers, cleaners and relatives the bogus directors of all those shell companies. These fraudulent companies were used for money laundering activities.

On April 20, Baid, the main accused and mastermind of Rs 836 crore loan fraud scam, was arrested for his role in aiding laundering of tainted money. The loan amount was taken from Bank of Maharashtra (BoM) for the purpose of helping the truck drivers, in the name of "Chalak se Malak" scheme. The special PMLA Court has sent Baid in ED custody till April 27.

After promoting the scheme, SVLL induced BoM to sanction and disburse the loan amount of Rs 651.17 crore for its 2804 vehicles and its employees/drivers, on the basis of false assurances and tempered vehicle registration documents. Another term loans of Rs 160 crore were sanctioned from BoM to SVLL themselves, and finally, a CC limit of Rs 35 crore got sanctioned to SVLL from BoM's branches in Pune and Surat.

Sources told that two more banks, i.e. Canara Bank and Bank of India has lodged a criminal complaint against before the Central Bureau of Investigation (CBI) against SVLL for a loan amount of about Rs 600 crore, taking the grand total of loan fraud scam to about Rs 1500 crore. However, the ED would remain focused only on BoM case i.e. Rs 836 crore, till the time CBI files its first prosecution complaint (chargesheet) against SVLL.

In the preliminary investigations under PMLA, the ED found that SVLL had created various dubious companies or fake automobile vendors to deal with the banks in getting the loan amount.

As per the modus operandi, the loan amount were disbursed in the accounts of fake vendors and later got it diverted to SVLL itself. To make it happen, SVLL provided the list of vendors to the BoM to whom the loan amount was to be disbursed on account of purchase of the vehicles.

"The accused (Baid) instead of purchasing the vehicles from the said loan amount, instructed all the concerned vendors to transfer the said funds in the accounts of SVLL, which later, got utilised by SVLL for their wrong gain," the remand application said.

In every meeting, Baid represented to the BoM authorities that the company had utilised the loan amount for the intended purpose. "This was to conceal the proceeds of crime generated by the criminal conspiracy by SVLL and other", the official said. According to remand application filed by ED, the entire amount of Rs 836.29 crore appear to be proceeds of crime, as defined under section 2 (1) of the PMLA.

The money trail found by the agency showed that loan amount of Rs 57.6 crore went into the accounts of the vendors (which are also under investigations and suspicious) and later the said amount was brought back into the accounts of SVLL.

Further, it was revealed that under the directions of Baid the amount of Rs 130.6 crore was disbursed by BoM officials to Addplus Distributors, one of the shell company. Addplus posed as vendor and represented by Baid before the BoM as authorised dealer of Ashok Leyland, but later, it was found that Addplus was not the authorised dealer.

Similarly, in another case, on the directions of Baid, letters were issued by SVLL to BoM authorities. Around 150 number of receipts of Trishul Motors (one of the vendor) were submitted for purchase of the vehicles indicating the name of the driver on it. Those receipts were found to be forged and fabricated by Trishul Motors, in fact, the company claimed that these receipts were not issued by them.

As per the remand application, Baid was summoned on April 20 at Mumbai ED office, where he admitted on record that under his directions, funds amounting to Rs 57.6 crore were brought back into the accounts of SVLL and the funds were not used for the intended purpose.

After cracking all the layers created by SVLL to loot the banks, the agency would bring all the bank officials (who have been suspended by BoM) under its radar. The chargesheet would also decide the fate of these bank officials who played the major role in clearing "Chalak se Malak" scheme and disbursing the loan amount to SVLL. "We are not ruling out the probe against bank officials, in future," an ED official said.

In 2015, was first to expose the fleet operator having political links, with series of exclusive stories on internal communications and forensic reports against disbursement of loans to SVLL, which later led RBI to examine the case, suspension of at least 3-4 bank officials of BoM and finally, the CBI registering a criminal complaint and conducting searches. On that basis, the ED filed its ECIR in the second week of November 2016 and began its investigation.