Ratul Puri and Moser Baer Involved in Bank Fraud Worth Rs 8,000 Crore, Says ED in Chargesheet

New Delhi: The Enforcement Directorate (ED), in its chargesheet against Madhya Pradesh Chief Minister Kamal Nath’s nephew Ratul Puri and Moser Baer India Ltd, has said that there was “misappropriation” of as much as Rs 8,000 crore bank loans.

The ED has filed a prosecution complaint against Puri, his associates and Moser Baer India Ltd, a company promoted by his father, before a special court in Delhi. The case was registered under the criminal provision of the Prevention of Money Laundering Act (PMLA).

"Investigation has revealed that Puri had transferred funds consisting of bank loans to various subsidiaries of Moser Baer across the world in the guise of giving loans and investments. Further, with the help of various hawala operators and professionals, Puri created corporate structures in various jurisdictions and invested in asset creation like buying factory, movable assets and for funding a lavish lifestyle for which a credit card was got issued from Dubai-based hawala operator Rajiv Saxena," the agency said.

Saxena, a prime accused in the Rs 3,600-crore AgustaWestland VVIP choppers money laundering case, was deported to India from Dubai earlier this year.

"The total amount spent on the credit card is $4.5 million which has been used for lavish stays, on holiday travels in private jets and night clubs," the ED said.

Puri, who has been an executive director in Moser Baer, was arrested by the agency case in August and, at present, is in judicial custody. He and his family members have denied any wrongdoing on their part.

The ED said loans to the tune of Rs 7,979.30 crore, taken from various banks, have been misused and misappropriated by Moser Baer, its directors and promoters for their own use and have further been transferred in the companies of Puri’s Hindustan Power Group.

“In order to avail the loan and for corporate debt restructuring, a fabricated document was submitted to the bank showing infusion of promoters' contribution which itself had come from suspicious sources,” the ED said.

“Corporate guarantees were given to lure the banks to disburse loans to subsidiaries beyond the net worth of Moser Baer,” the ED added. Over a period of time, it said, the receivables were written off and investments were shown to be diminished and written off.

"No efforts were made to recover the amounts. Most of the subsidiaries have an outstanding financial liability towards the banks totalling to Rs 7,979.30 crore," it said.