The Directorate of Enforcement (ED) arrested Sushil P. Mantri, director of the Mantri Developers Pvt. Ltd., under the Prevention of Money Laundering Act (PMLA), 2002.
The ED initiated the money laundering investigation in March 2022 on the basis of an FIR registered in Subramanyapura police station, Bengaluru in 2020 against the company and its directors and many other employees.
Many home buyers had filed complaints with the police as well as with the ED alleging that the accused entities/persons are involved in money laundering and have induced prospective buyers with rosily painted schemes, showing misleading brochures, falsification of delivery time lines and window dressing, and collected more than ₹1,000 crore as advance money from thousands of buyers. However, they had not been given possession of their flats even after passing of seven to 10 years, they alleged.
During investigation, it was also noticed that the company offered various “Ponzi-like schemes” as buy-back plan and advance money was collected for the flats/homes. In some cases, the company had not refunded the amount to the buyers even after clear direction of the Real Estate Regulatory Authority (RERA), an official release said.
The ED said investigation had revealed that the amount collected from the buyers by the company, which were meant for construction of the projects, had been diverted for personal use by the management of the company or for other fraudulent purposes, and hence the project was stalled.
The ED release also said currently, the group has total outstanding loans of approximately ₹5,000 crore from various financial institutions, out of which approximately ₹1,000 crore was overdue and some of the loan had been termed as NPA. It was also revealed that the company had “cross collateralised” its assets to different financial institutions to take multiple loans on the same assets, the release added.
Sushil was produced before the court and taken into ED custody for 10 days, while further investigation is underway.
