Enforcement Directorate on Thursday issued attachment orders freezing fixed deposits worth Rs.822 crore of B Ramalinga Raju, founder of scam-hit Satyam computers, and his family in connection with its probe in the money laundering case.
The orders issued by the Hyderabad zonal office of the agency specify that these deposits, held in the accounts of Ms Satyam Computers and Services Limited (SCSL), were being attached as it has identified these value of assets as "proceeds of crime" under the Prevention of Money Laundering Act (PMLA).
The accounts of SCSL, according to the ED attachment order, in Andhra bank, Bank of Baroda, IDBI and ING Vysya have been freezed, even as the agency has filed a complaint in this regard with the Adjudicating authority of the PMLA in Delhi.
The ED attached the accounts of SCSL 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 Rs.822 crores out of Rs.2171.45 crore found their way to Ms SCSL and were used for day-to-day expenses like payment of salaries among others.
"Since this amount subsists with Ms SCSL and constitutes a part of the loans that were derived or obtained by pledge of inflated shares of Ms SCSL, which is, Rs.2171.45 crores 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.
The ED had framed its case on the basis of the CBI FIR registered in this case and two subsequent chargesheets the probe agency filed in 2009.
The ED order explained the modus operandi of the sale of these shares to investors, which the agency alleges, were done by publishing wrong information.
"B Ramalinga Raju, Chairman of SCSL, had conspired with the other accused persons during the period 2001-2008 and lured investors into buying the shares of SCSL during this period by continuously publishing falsified books of accounts, thereby projecting a very rosy financial picture of the company for keeping the share prices of SCSL inflated.
"Raju who knew the true state of affairs of the finances in Ms SCSL, got the shares of SCSL held by him and his family members offloaded at opportune times and gained wrongfully. Offloading of inflated shares of Ms SCSL occurred by way of sale or pledge of shares," the ED said.
According to the probe of the agency, all the shares held in the name of Raju, his brother B Rama Raju, B Nandini Raju W/o Ramalinga Raju and B Radha Raju W/o B Rama Raju were transferred to Ms SRSR Holdings Private Limited in which family members of Ramalinga Raju were the directors.
The order said Ms SRSR Holdings pledged the inflated shares with non-banking financial companies and loans to the extent of Rs.2171.45 crore were obtained based on the inflated value of shares of Ms SCSL.
These loans were circuitously transferred among the 327 front companies floated by Ramalinga Raju, his relatives and his associates to disguise the true source of funds. The front companies used these loans to buy properties in Andhra Pradesh, Karnataka, Maharashtra and Tamil Nadu.
The ED has earlier attached 354 properties in this case which are valued at approximately Rs 250 crore.