Hyderabad: Investigation carried out by the Enforcement Directorate (ED) has revealed that the Karvy Group CMD Comandur Parthasarathy and CFO G Krishna Hari were the main conspirators in transferring the borrowed funds to WoS of Karvy Stock Broking Limited (KSBL), Karvy Realty India Limited (KRIL) and 14 shell companies.
The funds were further diverted by layering through a complex web of transactions from the several accounts of group companies without any financial rationale. Various financial consultants and defunct NBFCs were used to route the funds, according to a press release issued by ED.
Further, it was found that KSBL availed loans from Non-Banking Financial Companies (NBFCs) to the tune of Rs 400 crore in the name of five shell companies by pledging shares of clients of KSBL illegally.
The fraudulently availed loans were used to clear pending loans of related companies, do massive stock transactions which have allegedly turned into complete losses, and diverted to personally held family companies, the ED press release said.
The ED, which had earlier frozen shareholding of Parthasarathy worth around Rs 700 crore, is investigating the money trail to trace the proceeds of crime which are close to around Rs 2,000 crore.
The ED has arrested Parthasarathy and Krishna Hari under the Prevention of Money-laundering Act (PMLA) in a money laundering case connected with the fraud committed through the illegal diversion of clients’ securities by KSBL worth Rs 2873.82 crore and…
