BHUBANESWAR, Aug 11: The Enforcement Directorate (ED) has frozen 182 bank accounts and seized over Rs 1 crore in cash and six luxury vehicles during searches linked to an alleged Rs 2,000 crore multi state chit fund scam, officials said on Tuesday.
The ED’s Bhubaneswar Zonal Office carried out searches on August 5 at five locations in Visakhapatnam and Hyderabad under the Prevention of Money Laundering Act (PMLA), 2002. The premises were linked to Wellfare Buildings and Estates Pvt Ltd (WBEPL), its directors and associated entities.
According to the agency, searches were conducted at premises connected with former Andhra Pradesh MLA Malla Vijaya Prasad, Varaha Ramakrishna Satya Srinivasa Rao Alla and others.
The operation led to the recovery and seizure of Rs 1.01 crore in Indian currency, along with property-related documents, digital devices and other material allegedly connected with WBEPL, its directors and related entities.
The agency also issued freezing orders covering 182 bank accounts and seized six high end vehicles belonging to the company and its directors as part of the ongoing investigation.
The money laundering probe was initiated by the ED’s Bhubaneswar office on the basis of multiple FIRs and subsequent chargesheets filed by the Economic Offences Wing of Odisha Police, the Central Bureau of Investigation (CBI) and the Anti-Corruption Bureau (ACB) of Jharkhand.
During its investigation, the agency alleged that WBEPL’s directors and managing director had collected more than Rs 2,000 crore from thousands of investors across Odisha, West Bengal, Bihar, Jharkhand, Andhra Pradesh and other states.
The funds were allegedly collected through various schemes by promising investors land in Visakhapatnam, according to the ED.
The agency said the company subsequently shut down its branch offices operating across different parts of the country, allegedly leaving investors defrauded.
The ED further alleged that funds collected from investors were diverted towards unrelated activities and personal benefits. It also accused the company’s management of manipulating financial records to conceal deposits and carrying out irregular land transactions to suppress actual consideration and avoid statutory liabilities.
The investigation is continuing, with the agency examining the financial transactions, assets and alleged fund diversion associated with the company and its directors.