SFIO begins investigation into CG Power and its 15 group companies

The Serious Fraud Investigation Office (SFIO) has started probe into the alleged irregularities at CG Power and Industrial Solutions Ltd and its 15 group companies.

"The company has received a letter...from the office of the Joint Director (Investigation), SFIO, Ministry of Corporate Affairs...informing that the Central Government...has ordered an investigation by the SFIO into the affairs of the company and its 15 related/group companies (not having been specifically identified in the said letter)...The said SFIO Investigation has been initiated," CG Power and Industrial Solutions Ltd said in a regulatory filing.

The company was committed to cooperate with SFIO to enable them to complete its investigation in a time bound manner, the filing added.

Sources had earlier said that the Ministry of Corporate Affairs (MCA) has filed a petition before the Mumbai-bench of the National Company Law Tribunal (NCLT) seeking permission to re-open the books of account and recast the financial statements of CG Power and its subsidiary companies for the past five financial years beginning 2014-15.

MCA had previously asked its SFIO to probe the affairs of the company along with 15 other firms, including two subsidiaries CG Power Solutions Ltd and CG International BV.

The company had in August said that an investigation instituted by its board had found major governance and financial lapses, including some assets being provided as collateral and the money from the loans siphoned off by "identified company personnel, both current and past, including certain non-executive directors".

Gautam Thapar, who was non-executive chairman of the company, was removed by its board on August 29.