ED Cracks Down on Rs 122 Crore Bank Fraud in Bengaluru: Charges Filed Against Timber Firm and Directors
Bengaluru’s Enforcement Directorate (ED) has taken a big step in a major bank fraud case. The agency’s Bengaluru Zonal Office filed a charge sheet in the Special Court (PMLA) against Associate Lumbers Pvt Ltd (ALPL) and 17 other people. This comes in a Rs 122 crore scam involving money laundering and corruption, as ED announced on Wednesday.
The probe kicked off after the CBI’s Anti-Corruption Branch (ACB) in Bengaluru registered an FIR. It targeted ALPL, its directors, and others under IPC sections and the Prevention of Corruption Act, 1988. ED’s investigation uncovered shocking details: the company diverted funds to shell entities in Panama and Costa Rica. These were run by relatives of one ALPL director and disguised as advance payments for timber imports.
Through these shady dealings, the accused raked in crores in proceeds of crime (POC). ED has already attached properties worth Rs 4 crore under a provisional order dated September 11. Earlier this year, they seized immovable assets from ALPL directors valued at Rs 43 crore. That brings the total attachments in this bank fraud case to Rs 47 crore.
Digging deeper, ED found that ALPL directors—Mohamed Farouk Suleman Darvesh, Manoharlal Satramdas Agicha, Srichand Satramdas Agicha, and Ebrahim Suleman Darvesh—plotted to siphon off loans from Union Bank of India (formerly Corporation Bank). They funneled money to sister companies as unsecured loans or used it to buy properties in names like ALPL and Touchwood Real Estate Private Ltd. This caused a direct loss of Rs 56 crore to the bank when the account turned non-performing asset (NPA). Including interest, the total damage hit Rs 122 crore by the time the bank filed its complaint.
The fraud didn’t stop there. ALPL cooked up fake business entries with sister concerns to boost its turnover and drawing power. This trick helped them secure fresh credit facilities worth Rs 60 crore from the bank. In reality, there was no real business tie-up—just a scheme to inflate numbers and renew loans.
ED also spotted more red flags: funds went towards buying properties and settling sister companies’ bank loans or one-time settlements (OTS). Sales revenue from stocks bypassed the loan account entirely. To top it off, directors claimed Rs 7 crore worth of stock got "washed away" in the Chennai floods—but ED says they actually sold it off.
This Enforcement Directorate investigation into the ALPL bank fraud is ongoing, with more details expected to emerge. Stay tuned for updates on this Bengaluru money laundering case.
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