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ED goes to Singapore with $29 million attachment order in City Limousine fraud

After PML Act amendment, this will be first case of 'restitution' of duped investors' assets. This means attached assets of offenders will be used for repayment of investors

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The Enforcement Directorate (ED) officials have gone to Singapore to execute an attachment order of $29 million in the ill-famed City Limousine fraud case.

The funds in a foreign bank were parked by Sayed Mohammed Masood, chairman of the tainted investment company, City Group, after duping thousands of investors across the country by promising 48% returns on their investments.

"Three enforcement officers flew to Singapore to execute a letter rogatory (LR) and proceed with the attachment order under the Prevention of Money Laundering Act (PMLA)," a top ED official told dna.

"We have seized $29 million on Monday, of City Limousines and City Realcom, which was stashed in two bank accounts in Singapore," said ED officials. Both the companies – owned by Masood – had floated various schemes. After collecting around Rs 1,000 crore from investors, promising unrealistic returns, the companies shut operations in 2009.

"If we succeed in bringing these funds back to India, it would be the first case of 'restitution' of duped investors' assets from attached properties of offenders. Undoubtedly, this will be a big relief to the investors whose assets and monies were fraudulently appropriated by the City Group," a senior ED official told dna.

The amendments in the PMLA will enable for the repayment of assets to those investors whose assets and monies have been stacked in ponzi or chit fund cases.

The ED had initiated investigations under the PMLA in 2012 as Masood was found to have invested the proceeds of the crime abroad and in India. The ED probe concluded that after cheating and defaulting investors, Masood had transferred the investors' funds to two bank accounts in Singapore. Masood was arrested in 2012.

The scam came into light in 2009, when more than 42,000 cheques issued by the Masood's companies to the investors were dishonoured. More than 20 FIRs have been registered against the companies in Mumbai, Maharashtra, Karnataka, Rajasthan, Andhra Pradesh and Delhi on charges of criminal conspiracy, breach of trust and cheating.

The ED had conducted extensive investigations and found that Masood maintained bank accounts in Switzerland in his name and in the name of his companies. In October, the ED attached the Swiss bank accounts of Masood and other group companies. This was the first such move under the PMLA.

The ED has so far issued 14 orders, attaching movable and immovable properties in India with a market value of over Rs 130 crore in the names of City Group, Masood, wife Chand Masood Sayed, daughter Jabeen Masood Sayed, minor son Jibran Masood Sayed and other directors.

Meanwhile, the Singapore intelligence agency has widened its probe against Masood after coming across evidence of money laundering to tune of Rs 15 million dollar by the same group of companies.

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