In the first arrest made in the PMC Bank scam, the Economic Offence Wing (EOW) of the Mumbai Police on Thursday took into custody two promoters of the Housing Development and Infrastructure Limited (HDIL) Sarang Kumar Wadhawan and Rakesh Wadhawan and attached property worth Rs 3,500 crore that had been mortgaged to the bank.
Within days after the authorities discovered that the PMC Bank’s exposure to the HDIL group was nearly 73 per cent of its total loan book size of Rs 8,880 crore as of September 19, 2019, police arrested Sarang and Rakesh after they “failed” to give a “satisfactory” explanation to the questions posed by the EOW officials.
Deputy Commissioner of Police Pranay Ashok said, “The EOW of the Mumbai Police has arrested Sarang Wadhawan and Rakesh Wadhawan under Sections 409, 420, 466, 467, 471, read with 120 IPC. They were called for questioning today. The response from them was not sufficient and satisfactory. Their role in the PMC scam was sufficient ground for their arrest.”
Rakesh Wadhawan is the executive chairman of HDIL, while Sarang Wadhawan is its Managing Director.
Ahead of their arrest, the Government had issued a lookout circular against them, directing the immigration authorities to ensure that they do not leave India.
Rakesh and Sarang were placed under arrest sometime after they appeared before the EOW for questioning in connection with the PMC scam.
“We have identified 44 bank accounts relating to the accused associated with the HDIL. We have also found Rs 100 crore worth shares in the demat accounts of one of the accused. Appropriate measures are being taken to deal with these shares,” Ashok said.
HDIL is a listed real estate company, has played a key role in the PMC Bank scam. The Mumbai Police has registered a case against the former bank management and promoters of the HDIL in the PMC Bank scam case. The bank’s former chairman Waryam Singh, managing director Joy Thomas and other senior officials, along with the directors of HDIL Sarang Wadhwan and Rakesh Wadhawan, have been named in the FIR. HDIL’s promoters had allegedly colluded with the bank management, to draw loans from the bank’s Bhandup branch.
During the course of the investigations, it has come to light that the PMC Bank created more than 21,000 fake accounts to hide the various loans.