Mumbai: The enforcement directorate (ED) has served a notice to Union Bank of India related to large value transactions in its bullion accounts operated by aides of former Jharkhand chief minister Madhu Koda.
The bank had operated a bullion account and received Rs640 crore between 2006 and 2008 selling gold to the operators of the account, a senior official of the bank said under condition of anonymity.
“At that time proper KYC (know your customer) norms were followed and there was no irregularities,” said the official adding that the bank is not involved in any wrongdoing.
The bank is now investigating the issue and will come to a conclusion in two-three days, the official said.
The former chief minister was booked by the ED in early October under the Prevention of Money Laundering Act for allegedly diverting state funds and making huge investments abroad.
The directorate booked Koda and many of its associates after the Jharkhand vigilance department lodged a complaint against Koda for misappropriating state fund.
Separately, the Mumbai office of the Income Tax department will on Monday question M.V. Nair, chairman and managing director of Union Bank of India, about why the bank did not perform due diligence while accepting deposits of at least Rs991 crore from an alleged acquaintance of former Jharkhand chief minister Madhu Koda, said persons familiar with the development. Meanwhile, sources said the bank has not received any summons from either the Income Tax Department or ED so far.
“The Union Bank of India meanwhile said all accounts at its Zaveri Bazar branch in Mumbai are KYC (know your customer) compliant and there has not been any irregular transaction,” Bank sources said.
At the same time, the sources claimed that the bank has not received any summons from Income Tax Department or Enforcement Directorate so far.
Sources said that the summons have also been issued for Koda’s associate Binod Sinha and Sanjay Chowdhary—against whom a look out notice has been issued—to appear on 19 November.
“The ED will also inform the Financial Intelligence Unit (FIU) about the accounts as the banks had failed to inform it about the suspicious accounts which saw transactions worth several hundred crores,” they said.
It also questioned Alok Kumar, an associate of Binod and Harinder Singh, another aide of Koda.
“Sources claimed that during questioning Vikash had admitted to using an alloy making firm and a Mumbai-based bullion firm to route Koda’s illicit money through hawala network,” the sources said.
They said that he has also admitted about taking about Rs40 crore in cash to Kolkata for illicit investments at the behest of his brother, who was another close associate of the former chief minister.
Sources said that Sinha, who was also questioned on the foreign trips taken by him along with other accused in the case, has also revealed trails of money and investments made abroad.
Refusing to elaborate on the statements of Sinha as it could hamper further investigation into the case, ED sources said Koda, who has been booked under Prevention of Money Laundering Act (PMLA), would now be questioned not only on the basis of documents seized but also on the statements of Sinha.