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In the latest crackdown on financial irregularities, the Enforcement Directorate (ED) announced that it had confiscated luxury automobiles and jewellery totalling approximately Rs 65.75 crore during its investigation of real estate giants IREO and M3M. This action came as part of an ongoing money laundering probe into the companies, as announced in a public statement by the ED on Monday.
The federal agency disclosed that a series of searches had been conducted at seven different premises in Delhi and Gurugram on June 1. High-ranking individuals from the M3M Group, including Basant Bansal, Roop Kumar Bansal, and Pankaj Bansal, were notably absent during these raids, leading to accusations of deliberate evasion from the ED.
IREO has been under scrutiny for a while now on suspicion of misappropriating and illegally diverting investor funds. Investigations revealed that a substantial amount, running into hundreds of crores, was also channelled through the M3M Group.
The ED presented a case that highlighted a transaction where the M3M Group received Rs 400 crore from IREO Group via numerous shell entities. This was reportedly marked in the IREO ledger as payments for development rights to a piece of land owned by M3M Group, which had a market value of approximately Rs 4 crore.
During the search operations, the ED confiscated a fleet of 17 premium vehicles, including esteemed brands like Ferrari, Lamborghini, and Bentley, amounting to Rs 60 crore, and jewellery valued at Rs 5.75 crore. Furthermore, the agency seized Rs 15 lakh in cash and a plethora of potentially incriminating documents and account books.
The M3M Group stands accused of selling development rights of the mentioned land to five shell companies for Rs 10 crore, before those same companies sold those rights to IREO Group for Rs 400 crore. These shell companies are alleged to be under the operation of the M3M Group, with the Rs 400 crore from IREO Group promptly funneled back to M3M through multiple layers.
The ED claims that these shell entities were managed by the M3M Group at the behest of its promoters, namely Basant Bansal, Roop Kumar Bansal, and their kin. As per the agency, this manoeuvre enabled IREO and M3M to illicitly divert around Rs 400 crore of investor funds, with the M3M Group allegedly retaining the proceeds for further investments and debt repayment.
Meanwhile, the IREO Group is alleged to have taken no action to develop the land and instead begun writing off the investments year by year.
In conclusion, this ED crackdown highlights the agency's vigorous efforts to safeguard investor funds and uphold the law in the face of alleged financial misconduct. The investigations continue, as the ramifications of this case could be far-reaching for both IREO and M3M Group, potentially shaking the very foundations of India's real estate industry.
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