ED freezes Rs.822-cr assets of erstwhile Satyam Computers

The Enforcement Directorate (ED) on Thursday issued attachment orders freezing fixed deposits and properties worth R822 crore of B Ramalinga Raju, founder of erstwhile Satyam Computers, and his family in connection with its probe in an alleged money laundering case.

The orders issued by the Hyderabad zonal office specified that these deposits, held in the accounts of Satyam Computers and Services (SCSL), were being attached as it has identified these value of assets as "proceeds of crime" under the Prevention of Money Laundering Act (PMLA). This is the second time that Raju's properties are being attached.

According to the ED attachment order, the Satyam accounts in Andhra Bank, Bank of Baroda, IDBI and ING Vysya have been freezed, even as the agency filed a complaint in this regard with the adjudicating authority of the PMLA in Delhi. The ED attached the accounts of Satyam as its probe found that Raju and his associates "wrongfully" offloaded inflated shares of the said company by way of sale or pledging of shares, the order alleged.

According to the order, Raju and his family members allegedly 'lured' investors into buying these shares by publishing 'false' information about the financial credentials of the scam-hit company. Trail of loans derived from front companies revealed that R822 crore out of R2,171.45 crore found their way to SCSL and were used for day-to-day expenses like payment of salaries among others, it said.

"Since this amount subsists with SCSL and constitutes a part of the loans that were derived or obtained by pledge of inflated shares of SCSL, which is R2,171.45 crore, they fall within the mischief of proceeds of crime under the PMLA and are liable for attachment," the order said.

An attachment under PMLA ensures that such assets cannot be used by the accused and he/she cannot take any benefits from these properties, and such an order can be challenged by the accused at the adjudicating authority of the said act.

... contd.

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