Financial Daily from THE HINDU group of publications
Tuesday, May 14, 2002
Industry & Economy - Economic Offences
Gond used wife's cos to launder kickbacks
MUMBAI, May 13
MR Arun K. Gond, former Commissioner of Seamen's Provident Fund (SPF), used two companies registered in the name of his wife allegedly to launder kickbacks received from brokers.
Investigative agency sources believe Mr Sanjay Agarwal of Home Trade Ltd and stockbroker Mr Ketan Sheth, who was also a director of Home Trade, paid large amounts of money to Mr Gond to access the funds of SPF. The PF lost close to Rs 100 crore, which was supposed to have been used to buy Government securities, in the murky dealing. According to them, it was Mr Sheth who introduced Mr Gond to Mr Agarwal.
According to CBI sources, Mr Gond's wife had two companies - Anki Smitha and Serlie Securities - registered in her name. Serlie Securities is understood to have obtained a franchise of CMC Computers. The large amounts of funds made by Mr Gond were routed to this company for paying franchisee fee, the sources said.
According to them, Ms Gond used to give gift cheques to her husband on an almost "daily basis." They said it appeared the money earned by Mr Gond through illegal means was also shown as revenues of his wife's companies.
According to the first information report, Mr Gond was authorised by the PF board to invest its funds in Government securities. Mr Gond reportedly connived with Mr Agarwal and Mr Sheth for them to use the money behind the ruse of buying gilts on behalf of the PF. The FIR says the corresponding G-Secs were never delivered to SPF.
CBI sources said Mr Agarwal and Mr Sheth used four front companies - Dalhousie, Pacific, Hoogly and Poddar - to commit the fraud.
Meanwhile, the Securities and Exchange Board of India (SEBI) today extended the ban on trading activities by Home Trade Ltd to one year. In a notification, the market regulator stated that the restraint order against Home Trade is extended to one year or till the completion of investigation and action thereon whichever is later.
The National Union of Seafarers' of India (NUSI) has sought a guarantee from the Government on making up the Rs 100-crore loss in SPF.
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