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Business News/ Companies / Bank fraud: ED attaches Rs14.5 crore assets of Gujarat firm
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Bank fraud: ED attaches Rs14.5 crore assets of Gujarat firm

ED has booked M/S ABC Cotspin Pvt. Ltd and its director Ashish Sureshbhai Jobanputra under PMLA for duping SBI and Bank of Baroda using letters of credit for imports that never happened

Investigations revealed that ABC Cotspin siphoned off Rs79.49 crore out of India on the pretext of import that ‘never’ took place, the Enforcement Directorate said. Photo: BloombergPremium
Investigations revealed that ABC Cotspin siphoned off Rs79.49 crore out of India on the pretext of import that ‘never’ took place, the Enforcement Directorate said. Photo: Bloomberg

New Delhi: The Enforcement Directorate (ED) on Friday said it has attached assets worth Rs14.5 crore of a Gujarat-based firm for allegedly defrauding State Bank of India and Bank of Baroda (BoB) to the tune of over Rs804 crore.

The agency said it has issued a provisional order for attachment of two immovable assets—one located at Nariman Point in Mumbai and the other at Nikumbh complex in Ahmedabad—under the Prevention of Money Laundering Act (PMLA) against M/S ABC Cotspin Pvt. Ltd and its director Ashish Sureshbhai Jobanputra and others.

“The properties have been attached against the amounts remitted outside India," the ED said in a statement, adding that they were valued at Rs14.5 crore.

The ED had taken over the case against the Gujarat-based firm taking cognizance of a CBI FIR.

The CBI FIR had alleged that M/S ABC Cotspin Pvt. Ltd and its director entered into a “criminal conspiracy" with officials of Bank of Baroda in Ahmedabad and SBI in Gondal (Rajkot), and defrauded the two banks to the tune of Rs804.49 crore, the ED said.

The agency said the probe revealed that “the company was availing bill discounting facilities from the two banks against Letter of Credit (LC) of prime banks", During 2014-15, it said, Jobanputra “without" making any genuine export got prepared and signed the export documents and presented them to the banks.

“The bank officials also discounted the export bills without proper scrutiny of the bills and without ensuring that shipping bills issued by the Customs authorities are provided for, which is mandatory and are available at the time of discounting.

“They (bank officials) also discounted export bills on the basis of LC issued by the Industrial and Commercial Bank of China, which was restricted," it said.

Investigations revealed that ABC Cotspin siphoned off Rs79.49 crore out of India on the pretext of false import that “never" took place, the ED said. It said that Jobanputra is the “mastermind" of the fraud and that he along with his family left India soon after conducting these illegal transactions and has now settled in the US. “Enquiries against Jobanputra are also contemplated under the Fugitive Economic Offenders Ordinance, 2018," the ED said.

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Published: 25 May 2018, 04:26 PM IST
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