pch: Ed Arrests Director of Pch Limited for 370cr Loan Fraud | Hyderabad News
HYDERABAD: Enforcement Directorate, Hyderabad on Thursday arrested the promoter and director of leading electronics company PCH Corporation Limited, Balvinder Singh, in a case related to bank fraud totaling Rs 370 crore.
Singh was arrested on Tuesday and brought before the PMLA Special Court on Wednesday. He was held in custody until February 23. Singh, who is also a director of several PCH Group companies, was arrested under the Money Laundering Act (PMLA).
The defendants fraudulently took out credit facilities by providing forged documents to show higher sales and then diverted the loans. In addition, two other FIRs were registered against the PCH Group companies by the Central Bureau of Investigation in Bengaluru and Chennai.
ED’s investigation revealed that PCH Group companies had drawn loans from various public and private banks but failed to repay them. Loans were rerouted through shell companies with the help of accountants and record operators in Hyderabad and Mumbai.
This amount was returned to the PCH Group companies to paint a rosy picture of the PCH Group’s financial health, to draw down more credit and for an intended IPO.
ED said some of the money was diverted to the personal account of Singh and his family members and relatives. The investigation revealed that Singh received 54 crore from various shell companies which had no real business operations but was only used for money rotation.
ED said: “These amounts were projected by Singh as unsecured loans. The source of these funds is none other than the skimmed loan and they were used to purchase real estate on behalf of his companies as well as in his personal capacity which was later pledged to the banks for further borrowing facilities. To date, these unsecured loans have not been repaid.”
The ED initiated a PMLA case against the accused company based on an FIR registered by the CBI’s Chennai Economic Crimes Division.
The CBI, which previously filed an indictment, said PCH Agencies Private Limited, PCH Lifestyle Private Limited and Singh inflicted unlawful losses on Punjab and Sind Bank, a George Town branch in Chennai.
Singh was arrested on Tuesday and brought before the PMLA Special Court on Wednesday. He was held in custody until February 23. Singh, who is also a director of several PCH Group companies, was arrested under the Money Laundering Act (PMLA).
The defendants fraudulently took out credit facilities by providing forged documents to show higher sales and then diverted the loans. In addition, two other FIRs were registered against the PCH Group companies by the Central Bureau of Investigation in Bengaluru and Chennai.
ED’s investigation revealed that PCH Group companies had drawn loans from various public and private banks but failed to repay them. Loans were rerouted through shell companies with the help of accountants and record operators in Hyderabad and Mumbai.
This amount was returned to the PCH Group companies to paint a rosy picture of the PCH Group’s financial health, to draw down more credit and for an intended IPO.
ED said some of the money was diverted to the personal account of Singh and his family members and relatives. The investigation revealed that Singh received 54 crore from various shell companies which had no real business operations but was only used for money rotation.
ED said: “These amounts were projected by Singh as unsecured loans. The source of these funds is none other than the skimmed loan and they were used to purchase real estate on behalf of his companies as well as in his personal capacity which was later pledged to the banks for further borrowing facilities. To date, these unsecured loans have not been repaid.”
The ED initiated a PMLA case against the accused company based on an FIR registered by the CBI’s Chennai Economic Crimes Division.
The CBI, which previously filed an indictment, said PCH Agencies Private Limited, PCH Lifestyle Private Limited and Singh inflicted unlawful losses on Punjab and Sind Bank, a George Town branch in Chennai.