ED raids 26 locations in ABG Shipyard money laundering case

The Enforcement Directorate (ED) conducted massive searches at 26 ABG Shipyard locations in Mumbai, Pune, and Surat on Tuesday as part of its money laundering investigation into what may be the country’s largest bank fraud.

ABG Shipyard, based in Surat, and its previous proprietors are accused of defrauding a group of 28 banks out of Rs.22,842 crore.

Officials said the raids, which are being carried out at 24 locations under the Prevention of Money Laundering Act (PMLA), are taking place at the offices of ABG Shipyard, its sister firms, and executives in Mumbai, Pune, Surat, and other cities.

Based on a first information report (FIR) filed by the Central Bureau of Investigation (CBI) in a probe launched around the same time, the ED registered a money laundering case in connection with the matter in February.

According to preliminary investigations, large sums of money seized from banks may have been routed within India and internationally via more than 100 shell firms.

The CBI has accused ABG of defrauding a consortium of 28 banks worth Rs.22,842 crore, led by ICICI Bank, with ICICI Bank having the highest exposure of Rs.7,089 crore, followed by IDBI Bank (3,639 crore), State Bank of India (2,925 crore), Bank of Baroda (1,614 crore), and Punjab National Bank (1,244 crore).

Rishi Agrawal, the former Chairman of the shipping firm, was questioned by the federal agency earlier this month.

The agency is investigating the alleged “diversion” of bank loan funds, the formation of shell companies to launder public monies, and the role of the company’s leaders and others.