Gurugram, Feb 5 (NationPress) A Special PMLA Court in Gurugram has remanded the former resolution professional (RP) of a private enterprise to the custody of the ED for eight days, following his arrest for illicit fund diversion, according to official sources on Thursday.

The Directorate of Enforcement (ED), operating from the Gurugram Zonal Office, apprehended Arvind Kumar, the former RP of Richa Industries Limited, under the legal framework of the Prevention of Money Laundering Act (PMLA), 2002, on February 3, as revealed by an official announcement.

He was presented before the Special Court in Gurugram, which sanctioned an eight-day custodial period with the ED, as stated in the announcement.

Previously, the company’s former promoter and suspended MD, Sandeep Gupta, was taken into custody under Section 19 of the PMLA.

The ED launched an inquiry following an FIR filed by the CBI, which cited numerous sections of the IPC, 1860, and the Prevention of Corruption Act, 1988, regarding the execution of crimes such as criminal conspiracy, fraud, and misconduct.

The accused reportedly gained wrongful advantages, leading to significant losses for public sector banks amounting to Rs 236 Crore between 2015 and 2018, as indicated by the ED.

The findings from the investigation suggest that Arvind Kumar personally profited from illicit activities, confirming his direct engagement in money laundering, according to the ED.

During his role as the resolution professional, considerable funds from Richa Industries were misappropriated through complex transactions to individuals and entities closely affiliated with him, including associates and employees tied to his own business ventures, as per the ED.

Substantial sums were transferred from the corporate debtor's accounts to these intermediaries, who subsequently moved large amounts back into Arvind Kumar's personal bank accounts, the statement elaborated.

Bank records also disclosed unexplained cash deposits exceeding Rs 80 lakh in his personal accounts during his tenure, alongside credits exceeding Rs 1 crore from related parties who had previously benefited from payments made by the firm.

The investigation suggests that the detained RP benefited from the proceeds generated from the initial banking fraud, portraying illicit funds as legitimate earnings under the pretext of CIRP-related operations, the ED noted.

Investigators uncovered that the detained RP was implicated in the formation of an illegal and manipulated Committee of Creditors (CoC) by knowingly accepting fraudulent and inflated claims from unsecured financial creditors, many of whom were dummy or proxy entities controlled by the former promoters orchestrating the bank fraud, thereby granting decisive voting rights to the suspended promoters while marginalizing genuine public sector bank creditors.

He also faced accusations of collusion with former promoters by permitting them to maintain operational control over critical projects and assets, endorsing their participation in decision-making, and neglecting to act against arrangements that redirected valuable opportunities and funds to newly established entities for the personal gain of suspended directors.

The unlawful actions of the RP in orchestrating a 'pro-promoter conspiracy' resulted in an astounding 94 percent loss (haircut) to public sector banks. After the company's liquidation, banks received only Rs 40 crore against admitted claims totaling Rs 708 crore, as reported by the ED.