In a second arrest in less than one year, the Enforcement Directorate (ED) has arrested former chairman of Yes Bank Rana Kapoor in a money laundering case linked to the Mack Star Group-Rs 4300 crore PMC Bank scam case.

Rana Kapoor is the third person to have been arrested in the Mack Star Group-PMC Bank scam case. On January 23, ED had arrested Mehul Thakur and Madan Gopal Chaturvedi in this year. A day ahead of these arrests, the ED conducted raids at ten premises including the residence of former underworld don Bhai Thakur and offices of Viva Group which is controlled by his family.

Sixty-three-year-old Rana Kapoor -- who had earlier been on March 8 last year for alleged money laundering involving Yes Bank and scam-hit reality company Dewan Housing Finance Limited (DHFL) – is currently in jail in the DHFL case.

Rana Kapoor, who faces the charge of sanctioning a Rs.200-crore loan to Mack Star Marketing Pvt. Ltd (a group of the HDIL promoters Rakesh Wadhawan and Sarang Wadhawan), was produced before a PMLA court which remanded in ED custody till January 30.

The ED’s charge against Rana Kapoor is that he had siphoned off the loan amounts and given a lifeline to HDIL’s group companies to settle their outstanding with Yes Bank to prevent them from becoming NPAs.

HDIL’s Rakesh Wadhawan and Sarang Wadhawan, who are also prime accused in the PMC Bank scam, held a stake in Mack Star which is under the ED scanner for a Rs.200-crore loan given by Yes Bank for renovating its premises.

This is the second time Kapoor has been arrested in less than 10 months.  It may be recalled that on March 8 last year, the ED had arrested Rana Kapoor on March 8 this year for alleged money laundering involving Yes Bank and scam-hit reality company Dewan Housing Finance Limited (DHFL).

The ED’s contention was that the value of the property mortgaged with DHFL was inflated to Rs.750 crore against the cover-up loan of Rs.600 crore to M/s DOIT Urban Ventures (India) Pvt. Ltd (DUVIPL). The money allegedly laundered by Kapoor was used for personal purposes and hence alleged that there was a criminal conspiracy between Kapoor and the DHFL in the deal.

The raids on Rana Kapoor’s residence had come as part of the investigators’  effort to establish links between him and DHFL, whose founders are brothers Dheeraj Wadhawan and Kapil Wadhawan.

Apart from that of Kapoor, the accounts of his wife Bindhu, their three daughters - Rakhee Kapoor-Tandon, Roshni Kapoor and Radha Kapoor - are being examined by the ED.

Significantly enough, Kapil and Dheeraj Wadhwani’s uncle Rakesh Wadhawan and their cousin Sarang Wadhawan are among the prime accused who were arrested in the Punjab and Maharashtra Co-operative Bank (PMC Bank) scam which broke out in September last year

On June 25 last year,  the CBI filed a charge sheet against Yes Bank’s founder Rana Kapoor, M/s Dewan Housing Finance Ltd, its promoters Kapil Rajesh Wadhawan, Dheeraj Rajesh Wadhawan and M/s DOIT Urban Ventures (India) Pvt. Ltd (DUVIPL), its promoter Ms. Roshni Kapoor and others in the in the Rs.3,700-crore Yes Bank fraud case.

The others named in the charge sheet filed in Special CBI City sessions court were M//s Belief Realtors Pvt. Ltd; M/s RKW Developers Pvt. Ltd.