Rana Kapoor, the founder of crisis-ridden Yes Bank, was arrested by the ED on Sunday under money-laundering charges after over 20 hours of questioning and remanded to its custody till March 11, a day after the CBI booked him for allegedly receiving kickbacks of Rs 600 crore in form of loans to a company held by his three daughters.
As the agencies tightened the noose around the 62-year-old, his daughter Roshni Kapoor was stopped by ED from taking a flight to London as she is required to join the probe, officials said.
On Saturday, the agency had widened its probe as the premises of Kapoor’s daughters in Delhi and Mumbai were searched to gather more evidence.
The banker was taken into custody at the ED office in Ballard Estate under the provisions of Prevention of Money Laundering Act around 3 am on Sunday as he was allegedly not cooperating in the probe, they said. Kapoor was questioned for over 20 hours after ED raided his residence on Friday night.
On Sunday, the ED produced Kapoor before a holiday court in Mumbai and sought his remand, saying the role of some companies run by his family members needs to be established and they need to confront all these people with him.
The defence lawyer, however, said Kapoor has been selectively targeted by ED and he is cooperating with the probe agency. “We are ready to cooperate and submit all the documents that the agency wants. I have fully cooperated with them,” Kapoor said in the court.
“From the last few days I was not well, hence my family members took me to Breach Candy Hospital, but still I am cooperating with ED,” he told in the court.
However, the ED told the court it wants to conduct a through investigation and “many people are under the scanner”. The court then remanded Rana Kapoor in ED’s custody till March 11.
Kapoor was arrested by ED on the basis of the CBI FIR registered on Saturday, after allegations of financial irregularities and mismanagement in the operations of Yes Bank surfaced and the RBI and the Union government initiated action to control its affairs.
Sources said the CBI booked Kapoor, DoIT Urban Ventures Ltd, a company allegedly held by his family members and promoter-director of DHFL Kapil Wadhawan for alleged criminal conspiracy, cheating and corruption. The details of the FIR emerged on Sunday when the enforcement case information report (ECIR) of ED became public.
The CBI alleged Kapoor entered into a criminal conspiracy with Wadhawan for extending financial assistance to DHFL though Yes Bank in return for substantial undue benefits to himself and his family members through companies held by them.
According to the CBI FIR, the scam started taking shape between April and June 2018 when Yes Bank invested Rs 3,700 crore in short-term debentures of scam-hit DHFL.
In return, Wadhawan allegedly “paid kickback of Rs 600 crore” to Kapoor and family members in the form of loans to DoIT Urban Ventures (India) Pvt Ltd, officials said.
DoIT Urban Ventures is held by daughters of Kapoor – Roshini, Radha and Rakhee – which are 100 per cent share holders of the company through Mogran Credits Pvt Ltd, it alleged.
“Rana Kapoor obtained undue pecuniary advantage from DHFL in the matter of investment in the debentures of DHFL by Yes Bank, through the companies held by his wife and daughters,” the FIR alleged.
The ED investigating officer had recorded Kapoor’s statement under PMLA when he was first interrogated on Friday night at his upscale residence in ‘Samudra Mahal’ complex in Worli area here.
He was brought to the ED office on Saturday noon for a fresh round of questioning.
According to officials, Kapoor’s wife Bindu and daughters Rakhee Kapoor Tandon, Roshni Kapoor and Radha Kapoor are allegedly linked to some companies to which the suspected “proceeds of crime” have been traced.
The central agency is also probing Kapoor’s role in connection with the disbursal of loans to some corporate entities and the subsequent alleged kickbacks reportedly received in his wife’s accounts.
Other alleged irregularities are also under the agency’s scanner including the one related to the alleged PF fraud in the Uttar Pradesh power corporation, they added.
The CBI has recently taken over investigation into the Rs 2,267-crore Employees’ Provident Fund fraud in Uttar Pradesh, where hard-earned savings of power sector employees were invested in Dewan Housing Finance Corporation (DHFL).
The Reserve Bank of India had on Thursday imposed a moratorium on Yes Bank, capping withdrawals at Rs 50,000 per account, and superseded the board of the private sector lender with immediate effect.
Yes Bank will not be able to grant or renew any loan or advance, make any investment, incur any liability or agree to disburse any payment.
As per the RBI’s draft reconstruction scheme, State Bank of India will pick up 49 per cent stake in Yes Bank under a government-approved bailout plan.