This is the first action the investigating agency has taken against (CAs) for benami transactions.
The Enforcement Directorate (ED) on Thursday raided 6 Chartered Accountants (CAs) across Delhi under PMLA in connection with benami transactions of over 200 crore using shell companies allegedly formed by the Jain Brothers. Sources say the CAs were helping Jain Brothers through advice on illegal cash conversions.
This is the first action the investigating agency has taken against (CAs) for benami transactions.
The ED conducted raids in Dilshad Garden, Laxmi Nagar, Model Town, Azadpur, and Rana Pratap Bagh areas in New Delhi. A senior ED official told DNA that the raids were held to uncover funds that had been stashed to the tune of thousands of crores.
Recently the ED had uncovered a racket of shell companies, and later on, arrested two key persons — Surendra Jain and Virendra Jain on March 17, this year. This led to the Serious Fraud Investigating Office (SFIO) filing a criminal complaint in the Tis Hazari Courts, Delhi, against the Jain Brothers. A case under the Prevention of Money Laundering Act, 2002 (PMLA) was also registered by the ED.
ED sources say that the accused CAs have been closely associated with the Jain brothers and had helped them to open these shell companies.
"Jain Brothers laundered Rs. 3790 crores for the beneficiaries in the last six years. The investigation revealed that Jain Brothers laundered Rs 561 crores for the 559 beneficiaries in the FY 2009-10 with the help of 56 mediators including Chartered Accountants and Company Secretaries. SFIO has investigated and filed the criminal complaint against the 11 companies controlled and managed by Jain Brothers who have also been used for laundering money for various other beneficiaries," the ED said in a statement.
ED sources also said that they had seized documents which have strong proof of connivance among bankers,CAs, and beneficiaries to exchange of illegal cash via dubious companies or through other accounts.
Reacting to the ED's statement, sources from the ICAI (Institute of Chartered Accountants of India), aregulatory body of CAs, said to DNA, "ICAI council will be meeting on April 20, 2017, where we will take a final decision about the fate of these accused CAs. They could be suspended from the profession for the next few years."
The Disciplinary Directorate of the ICAI has already been seized of the matter and initiated proceedings against such Chartered Accountants.
"The matter will be dealt seriously to look into all the violations in these cases as per the Code of Conduct of the Institute. All the necessary action will be taken in accordance with the laws of the land," ICAI said in a statement.
CAs In The Dock
- 6 CAs involved in benami transactions of over Rs 200 crore using shell companies
- 34 Delhi-based CAs on ED radar
- CA Sunil Agrawal arrested for laundering money of IAS officer Babulal Agrawal
- On Feb 9, 2017, DNA has reported that CAs could be jailed for up to seven years if found helping in instigating for or abatement of any benami transaction.
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