Brank Fraud Case – Conviction For De Frauding Bank Loan
Hyderabad, India – On February 21, 2023, the Directorate of Enforcement (ED) announced the conviction of all accused in a bank fraud case involving money laundering defined under section 3 of the Prevention of Money Laundering Act (PMLA) 2002.
The Metropolitan Sessions Judge in Hyderabad has sentenced Smt. T Jayasree, M Chinna (employees of M/s Chakkilam Trade House Limited), and three bank officials namely:
- S Narasimhan
- A Sesibhushana Rao, and
- S Arogyam is to undergo rigorous imprisonment for 7 years and to pay a fine of Rs. 50,000 each.
Additionally, M/s Chakkilam Trade House Limited has been directed to pay a fine of Rs. 1 lakh.
The ED conducted the PMLA investigation based on a case registered by the Central Bureau of Investigation, Anti-Corruption Branch, Hyderabad, under various provisions of the Indian Penal Code, 1860, and Prevention of Corruption Act, 1988.
The investigation found that M/s Chakkilam Trade House Limited, represented by its Director Late Sh. Chakkilam Raghuram fraudulently availed loans from SBI on the basis of fabricated financial statements, board resolutions, and documents showing higher turnover and fake MoUs with various parties showing business dealings.
The total amount of Rs. 2,08,50,000 sanctioned by SBI was misappropriated and laundered.
It was also discovered that the properties that were mortgaged with the banks for the loan were already sold by the company and its promoters.
Following the investigation, the ED filed a Prosecution Complaint in December 2013 against M/s Chakkilam Trade House Limited and six accused persons, including three bank officials, involved in the offense of money laundering.
The trial has resulted in the conviction and sentencing of all accused parties.