The Enforcement Directorate (ED) arrested global tours and travel company Cox and Kings Group (CKG) promoter Ajay Peter Kerkar under the relevant sections of the Prevention of Money Laundering Act (PMLA), in an alleged money laundering case involving thousands of crores of rupees.

Kerkar, will be produced in court on Friday. He has been refuting all the allegations levelled against him.

He is also booked for cheating, forgery, and criminal conspiracy in four first information reports (FIRs) registered by the banking (fraud) unit of Mumbai Police’s economic offences wing (EOW) based on the complaints made by Axis Bank, Kotak Mahindra Bank, IndusInd Bank and a private investment firm. According to these four financial institutions, the amount in the irregularities is worth Rs1,900 crore.

The names of CKG and Kerkar emerged when the central agency was probing the financial irregularities and money laundering linked to the Yes Bank case. ED had arrested Yes Bank’s founder Rana Kapoor in March. The agency has since then been scanning the transactions made by the bank to its borrowers. Last month, ED had arrested CKG’s chief financial officer Anil Khandelwal and internal auditor Naresh Jain in connection with the Yes Bank case. In June, ED had raided five premises belonging to the senior management of CKG.

Investigations have revealed that CKG has defaulted loans from Yes Bank worth Rs3,642 crore.

ED stated that CKG forged its consolidated financials by manipulating the balance sheets of overseas subsidiaries. In addition to this, some board resolutions submitted to banks for sanctioning the loans were also found to be forged. The loan sanction from Yes bank was driven by Kapoor after bypassing the norms.

“ED gathered the evidence regarding clear instructions of Kapoor to the bank officials concerned to get the said loan continued and not to take efforts to recover it,” the agency had previously said.

The probe has also revealed that between the financial year 2015 to 2019, lending worth Rs3,908 crore was made to 15 fictitious customers. The majority of collections shown in ledgers from Ezeego (another group entity of CKG ) were not found in the bank statements. There are 15 fictitious, high-value debtors reflected in the books of accounts and another 147 sets of customers also appeared to be suspicious and non-existent, the agency said.

The Cox and Kings Limited (CKL) has diverted Rs1,100 crore to another stressed company which has no business relationship with the company without any approval of its board, ED has further alleged.

The probe conducted so far has revealed that the bank transactions of CKG are not matching with its books of accounts. The travel company was declared bankrupt last year in October after it defaulted on payments to the bank.

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