Mumbai, March 7
The Enforcement Directorate (ED) on Friday conducted searches at “Samudra Mahal”, the Worli (South Central Mumbai) residence of founder and former managing director of “Yes Bank”, which has been placed under moratorium by Reserve Bank of India (RBI) for financial mismanagement.
“In exercise of the powers conferred under 36ACA of the Banking Regulation Act 1949, the Reserve Bank has, in consultation with Central Government, superseded the Board of Directors of “Yes Bank Ltd”. for a period of 30 days owing to serious deterioration in the financial position of the Bank. This has been done to quickly restore depositors’ confidence in the bank, including by putting in place a scheme for reconstruction or amalgamation. Prashant Kumar, ex-DMD and CFO of State Bank of India has been appointed as the administrator under Section 36ACA (2) of the Act”, the official communication stated.
Friday’s ED’s search was based on evidence reflecting a Rs 600-crore loan sanctioned by DHFL to Doit Urban Ventures, controlled by the family of Rana Kapoor.
While the Yes Bank went into red, the State Bank of India offered to acquire 49 per cent stakes in the Yes Bank. The SBI will bring in Rs 2500 crore for a crisis ridden ‘Yes Bank” and will ensure repayment of all deposits, dilution of equity and write off of Rs.10,800 crore of additional tier I (AT 1 )bonds
RBI has put “Yes Bank” under moratorium and suspended the its board for 30 days. The RBI also capped withdrawal limit at Rs.50,000 for the one-month period. The moratorium came after Rana Kapoor-promoted bank failed to raise capital to address potential loan losses and in the wake of deteriorating financials of the bank.
“The ED is currently conducting searches in connection with loans granted to DHFL (Dewan Housing Finance Ltd),” said an ED official.
The Union government on Friday said that it has asked RBI to submit a detailed assessment report of any alleged financial irregularities which contributed to the bank’s deteriorated condition.
The Prevention of Money Laundering Act (PMA) case by ED against Kapoor is a continuation of its investigations against DHFL where it has found fund diversion to the tune of Rs.12,733 crore to 80 alleged shell entities using one lakh fake borrowers. These transactions date back to 2015.
“In some instances we found that the funds that were diverted by DHFL originated from Yes Bank. The searches are to ascertain the nature of these loans and whether there was any irregularity in granting them,” said the ED official. ED is also expected to issue a look out notice against Kapoor. The notice prevents individuals being probed by an investigative agency to leave the country.
The ED has accused the Kapil and Dheeraj Wadhawan of DHFL of purchasing shares of five firms— Faith Realtors, Marvel Township, Abe Realty, Poseidon Realty and Random Realtors—after which they were amalgamated with Sunblink. The outstanding loans of these five firms, totalling around Rs.2, 186 crore till July 2019, were allegedly appropriated onto the books of Sunblink in order to cover the diversion of loans acquired from DHFL.
Raju Vernekar is a Media Professional based in Mumbai and is a regular contributor of Imphal Times. He had served as Chief Reporter at Free Press Journal (1996 – 2015 ). His Activities includes writing for different news papers, script writing/production for TV channels, Films Division. Writing poems in Marathi, Hindi, English, Guiding mass media students and helping people to solve their problems. Raju may be contacted at [email protected]
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