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ED arrests Yes, bank promoter Rana Kapoor in a DHFL money laundering case

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MUMBAI: The Execution Directorate (ED) early Sunday arrested Yes Bank promoter Rana Kapoor in a money laundering case involving Dewan Housing Finance Corporation Ltd (DHFL) after 30 hours of interrogation. He will be presented to a court around 11 am on Sunday.

The ED who continued his searches at the Samudra Mahal residence of Rana Kapoor in Worli on Saturday, is investigating whether Doit Urban Ventures, a fictional company controlled by the founder of Yes Bank and two of his daughters, received Rs 600 million rupees as bribes by Dewan Housing Financial Corporation Ltd (DHFL) fraud for loans worth Rs.4,450 million granted by the bank.

ED officials stated that Yes Bank had granted a loan of Rs.3,750 million to DHFL and another loan of Rs 750 million to RKW Developers, a company controlled by DHFL. When they did not pay, Yes Bank did not initiate any action, and the ED suspects that Kapoor and two of his daughters (he has three), who are directors of Doit Urban Ventures, allegedly received bribes from DHFL.

The ED suspects that this amount of Rs 4,450 million rupees is part of Rs 13,000 million rupees allegedly diverted by DHFL through 79 fictitious companies, with Doit Urban Ventures as one of them.

Emergency department officials, who had begun questioning Kapoor on Friday night, continued their interrogation until the morning and around 11 a.m. On Saturday, he was taken to the regional office of the agency in Ballard Estate to interrogate him after which he was arrested in the case around 3 a.m. ED officials also searched the facilities of their three daughters in Mumbai and Delhi and the headquarters of Yes Bank in Prabhadevi.

Daughters’ statements would be recorded and Kapoor family financial transactions examined, authorities said.

The former DHFL CMD, Kapil Wadhawan, is also one of the promoters of RKW Developers. The DE had arrested Wadhawan in January in another money laundering case he is investigating against the late drug dealer Iqbal Mirchi. Wadhawan is currently on bail.

During its investigation into the Mirchi case, the ED discovered that DHFL had allegedly diverted around Rs 13,000 million through fictitious companies and more than one lakh of fictitious accounts.

ED officials said the state-owned company Uttar Pradesh Power Corporation Ltd (UPPCL) had allegedly invested 4,100 crore of money from the employee’s pension fund in DHFL without taking the required approval. The agency suspects that DHFL allegedly also washed this money through fictitious transactions. The ED has registered a separate money laundering case against DHFL and UPPCL employees.

Yes, the Bank was placed under a moratorium on Thursday and its board replaced, with the Reserve Bank of India limiting the withdrawal of deposits in the bank to Rs 50,000 per account.

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