What are the Findings of the K’taka ALPL Money Laundering Case?
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Synopsis
The ED's investigation into Associate Lumbers Pvt Ltd (ALPL) reveals a complex web of money laundering involving fund diversion to offshore entities, leading to significant losses for Union Bank. With properties attached and ongoing investigations, this case highlights serious financial misconduct.
Key Takeaways
- Enforcement Directorate files charge sheet against ALPL.
- Funds diverted to Panama and Costa Rica.
- Losses to Union Bank exceed Rs 122 crore.
- Properties worth Rs 47 crore attached.
- Further investigations are underway.
Bengaluru, Sep 17 (NationPress) The Enforcement Directorate (ED), Bengaluru Zonal Office, has submitted a charge sheet to the Special Court (PMLA) in Bengaluru against Associate Lumbers Pvt Ltd (ALPL) and 17 other individuals related to a significant Rs 122 crore bank fraud case, as confirmed by the agency on Wednesday.
The ED's inquiry was initiated following an FIR lodged by the CBI, ACB, Bengaluru, against ALPL, its Directors, and others under various sections of the IPC and the Prevention of Corruption (Amendment) Act, 1988.
The investigation uncovered that funds had been funneled to entities in Panama and Costa Rica, controlled by relatives of one of ALPL's Directors, as an advance for timber imports.
These illicit activities led to the generation and acquisition of Proceeds of Crime (POC) amounting to crores of rupees. The ED has attached properties worth Rs 4 crore through a Provisional Attachment Order dated September 11. Earlier, in 2024, properties valued at Rs 43 crore held by ALPL's Directors were attached, totaling Rs 47 crore in attachments in this case, according to the ED.
The investigation further revealed that Associate Lumbers Pvt Ltd, represented by its Directors Mohamed Farouk Suleman Darvesh, Manoharlal Satramdas Agicha, Srichand Satramdas Agicha, and Ebrahim Suleman Darvesh, conspired to siphon off loan amounts sanctioned by Union Bank of India (formerly Corporation Bank) to either ALPL's sister concerns in the form of unsecured loans or to other firms for property purchases in the name of ALPL and Touchwood Real Estate Private Ltd., causing a loss of Rs 56 crore to the bank, with a total loss, including interest, of Rs 122 crore as of the date the complaint was filed.
The ED's investigation also showed that ALPL engaged in multiple 'accommodative entries' lacking any genuine business relationships with its sister concerns, solely to inflate its turnover and enhance its drawing power (DP). This manipulation led to the renewal of credit facilities amounting to Rs 60 crore from the complainant bank.
In conclusion, ALPL and its sister concerns participated in accommodative entries that allowed the renewal of credit facilities based on inflated turnover while facilitating the diversion of loan proceeds to sister concerns.
Additionally, funds were misappropriated for acquiring immovable properties and settling loans of sister concerns with banks, while revenue from stock sales was not routed through the loan account. Furthermore, stock valued at Rs 7 crore was disposed of by the Directors, who claimed it was lost in the Chennai floods, the ED reported.
Further investigations are ongoing.
Point of View
It is crucial to address the systemic failures that allow fraud to proliferate. The case against ALPL serves as a reminder of the need for stringent regulatory oversight and accountability within financial institutions. The actions of the ED reflect a commitment to upholding the rule of law and protecting public interest.
NationPress
20/09/2025
Frequently Asked Questions
What is the ALPL money laundering case about?
The ALPL money laundering case involves the Enforcement Directorate's investigation into a Rs 122 crore bank fraud linked to Associate Lumbers Pvt Ltd, with funds being diverted to offshore accounts.
What organizations are involved in the investigation?
The investigation is being led by the Enforcement Directorate (ED) and was initiated based on an FIR from the Central Bureau of Investigation (CBI).
What are the key findings of the ED investigation?
The ED found that funds were diverted to entities in Panama and Costa Rica, leading to a total loss of Rs 122 crore for Union Bank, alongside the attachment of properties worth Rs 47 crore.
Who are the key individuals implicated in the case?
The key individuals include Directors of ALPL, such as Mohamed Farouk Suleman Darvesh and Manoharlal Satramdas Agicha.
What is the current status of the investigation?
Further investigations are ongoing, with the ED continuing to explore the financial activities of ALPL and its associated entities.
