Who is the company promoter arrested for a Rs 137 crore fraud?
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Synopsis
In a shocking turn of events, the ED has apprehended a company promoter linked to a massive Rs 137 crore fraud involving deceitful agro deals. This article delves into the intricate web of deceit spun by the Suumaya Group and its associates, revealing how they misled investors and diverted funds under the guise of a charitable program.
Key Takeaways
- ED arrests Ushik Gala for alleged fraud.
- Fraud involved Rs 137 crore linked to fake agro deals.
- Investigation revealed circular transactions inflating company turnover.
- Significant assets and records seized during ED searches.
- Need for stricter regulation in corporate governance highlighted.
Mumbai, Nov 20 (NationPress) The ED’s Mumbai division has taken into custody a promoter from a company involved in the embezzlement of Rs 137 crore through fraudulent Haryana agro agreements, allegedly related to the 'Need to Feed program' of an NGO.
The Directorate of Enforcement (ED), Mumbai Zonal Office, apprehended Ushik Gala, the promoter of the Suumaya Group of companies, under Section 19 of the Prevention of Money Laundering Act (PMLA), 2002.
This arrest occurred on November 17 after an extensive investigation and review of evidence compiled during the ongoing inquiry concerning the Suumaya Group. Gala has been held in ED custody until November 24.
The ED's investigation commenced following a First Information Report (FIR) filed at the Worli Police Station, which was subsequently taken over by EOW Mumbai, against Dentsu Communications India Private Limited, Suumaya Industries Ltd., and their promoters, among others, as stated by an official.
They are accused of colluding and misappropriating funds amounting to Rs 137 crore under the pretense of promising future benefits from the 'Need to Feed program', according to the official statement.
The ED's findings further suggest that the Suumaya group and some staff members from Dentsu India fabricated a fictitious Haryana government contract under the pretext of the 'Need to Feed' program to secure funds through trade financing, thereby converting and presenting non-existent business activities as legitimate revenue.
The investigation revealed that funds received by Suumaya group entities were funneled by Ushik Gala to dummy agro-trader entities based in Delhi and Haryana via an agent to falsely depict authentic procurement.
No genuine agro purchases were made. Instead, the diverted funds were redirected back to Ushik Gala through a mix of cash and RTGS transactions from various shell entities.
Suumaya generated fake invoices and transport receipts to simulate significant trade volumes, resulting in circular transactions totaling Rs 5,000 crore, of which only around 10% were legitimate, as reported by the ED.
These transactions occurred in a circular manner, leading to an artificial increase in the turnover of the entities involved, including Dentsu India. This inflation in transactions misleadingly boosted Suumaya's turnover (from Rs 210 crore to Rs 6,700 crore in two years) and caused its share price to skyrocket, presenting a distorted image to investors in its listed group entities, the report stated.
Previously, the ED executed search operations at 19 locations across Mumbai, Delhi, and Gurugram during this investigation. They seized movable assets and a substantial amount of financial and digital records, along with documents substantiating the offence of money laundering and fund diversion, as mentioned in the statement.
Point of View
This incident highlights the critical need for stringent oversight in corporate governance. The actions of the Suumaya Group and its affiliates pose serious questions about accountability and transparency in business practices. As we report on these developments, it is imperative to remain vigilant and ensure that justice is served while protecting the integrity of the financial sector.
NationPress
20/11/2025
Frequently Asked Questions
What charges has Ushik Gala faced?
Ushik Gala has been arrested under Section 19 of the Prevention of Money Laundering Act (PMLA), 2002, for allegedly embezzling Rs 137 crore.
What is the 'Need to Feed program'?
The 'Need to Feed program' is an initiative associated with an NGO, purportedly aimed at providing food assistance, which was misused in this case for fraudulent activities.
What evidence led to the arrest?
The arrest was based on a detailed investigation and analysis of evidence gathered during the probe into the Suumaya Group's financial activities.
How much money was embezzled?
The total amount embezzled is reported to be Rs 137 crore.
What actions did the ED take during the investigation?
The ED conducted searches at 19 locations and seized movable assets, financial records, and documents related to the money laundering case.
