SFIO probe also charges him with criminal conspiracy, cheating and forgery
Minister for Forests C.P. Yogeshwar has been charged with corporate fraud, criminal conspiracy, forgery and cheating in an investigation conducted by the Serious Fraud Investigation Office (SFIO) the Union Ministry of Corporate Affairs into the dealings of his company, Megacity (Bangalore) Developers and Builders Ltd. (MDBL).
The SFIO, which investigated the Satyam Computers case, in its July 30 investigation report, recommended criminal prosecution of Mr. Yogeshwar, who is Managing Director of MDBL, and other company directors, including his brother C.P. Gangadhareshwar, on 16 charges. The SIFO investigation began in April 2009.
The Criminal Investigation Department (CID), Bangalore, filed a charge sheet against Mr. Yogeshwar in March last year for siphoning off about Rs. 37 crore from his company and cheating thousands of people who had paid money for sites in his company's Vajragiri Township project.
However, the charges now levelled by the SFIO — criminal conspiracy, forgery, giving false information to investigating officer, non-cooperation with the investigation, apart from corporate offences — are more serious in nature. If found guilty, he can be sentenced to life imprisonment.
CID charge upheld
The report, besides reaffirming the CID charge of cheating, also states that Mr. Yogeshwar had forged about 450 sale agreements to show that about Rs. 37 crore was paid to landowners to purchase their land and illegally used the company's money.
The SFIO has found that in some cases survey numbers mentioned in the agreement do not exist, in some cases agreements were made in the name of dead people, and in many cases the agreement had neither been signed by the particular landowner nor had the landowner received payment from him. In some other cases, only part payments were made.
‘No real name'
The report found that Mr. Yogeshwar had illegally obtained three different Director Identification Numbers (DINs) by giving his name, his father's name and address in three different ways (though he had never changed his original name) in violation of the Companies Act. He had taken three DINs under different names as he was aware that had become “ineligible” to become a director of a company because he had failed to submit annual returns of his company for three consecutive years from 2006 to 2009, the report states. He was given one of these DINs when he was Chairman and Director of State-owned Karnataka Silk Industries Corporation last year.
Other charges include swindling Rs. 3.6 crore from the account of his company, constructing a building for another firm (Fashion Forum Pvt. Ltd.) and a house for himself near Channapatna by misappropriating Rs. 1.59 crore from the company's funds, not filing annual returns, balance sheet and profit and loss account, not holding general body meetings of the company, not accounting for certain parcels of land belonging to the company, and not furnishing certain information during the investigation despite summons.
The SFIO has also recommended action against the two statutory auditors for alleged professional misconduct under the provisions of the Chartered Accountant Act.