ED nets former First Leasing officers in Rs 500-cr fraud case

Dilliraj, Sivaramakrishnan remanded to custody, on IDBI, SBI complaints

Enforcement Directorate on Monday said it had arrested S Dilliraj and L Sivaramakrishnan, both former chief financial officers of non-banking financial company First Leasing, in an alleged Rs 500-crore fraud case.

Both have been charged under the provisions of Prevention of Money Laundering Act, 2002.

The case was registered by the Directorate of Enforcement, Chennai, against the Chennai-based company and others in relation to a case registered by the CBI against them for allegedly cheating IDBI Bank and State Bank of India to the tune of Rs 500 crore.

Dilliraj is now president of Bharat Financial Inclusion (BFI). The company said he has been relieved from First Leasing (FLCIL) on January 18, 2008, after resigning on November 22, 2007.  The investigation does not relate to it in any way, added BFI. In a personal statement on October 19, 2015, Dilliraj had stated all loans taken during his tenure were repaid and the complaint filed by the IDBI Bank related to loans sanctioned in 2012 and 2013 — four-five years after he had quit First Leasing.

Earlier, the ED had arrested Farouk Irani, the former managing director of the company. It had provisionally attached property worth Rs 51 crore.

“During the course of further investigations, searches were conducted at the residential premises of Dilliraj in Hyderabad and Sivaramakrishanan in Chennai and certain property documents were recovered. They admitted their crucial role in fudging of the accounts of FLCIL in order to obtain undue loans from the banks. In the process, they were enriched and aided undue enrichment persons like Farouk Irani,” said ED.

The duo was produced before the court on Monday and both were remanded to judicial custody up to 11 August.
 

According to an earlier statement, based on a complaint filed by the IDBI Bank, the CBI has registered an FIR against the company and its key personnel, alleging a fraud to the tune of Rs 274 crore. The SBI complained that the company has conducted fraud to the tune of Rs 248 crore.