Edelweiss: Not under investigation in Capstone case
BusinessToday.In February 13, 2020
Responding to reports regarding an alleged Enforcement Directorate investigation associating Edelweiss group with Capstone Forex in a foreign exchange scam, Edelweiss Chairman Rashesh Shah said his company has no relation with the Capstone. Shah's remarks came after the Enforcement Directorate uncovered a foreign exchange scam worth Rs 700 crore in Maharashtra-based Capstone Forex.
"Edelweiss has no relationship with Capstone Forex Pvt. Ltd. and all allegations of FEMA violations are false. We appreciate that regulators and agencies have an obligation to investigate; if any information is sought from us, as a responsible corporate citizen, we will of course provide the same," Shah said in a statement.
The Edelweiss Chairman also clarified on his alleged relationship with Sanjay Shah, an independent director of some Edelweiss group companies with purported links to Capstone. An anonymous letter to the Prime Minister went as far as calling Sanjay the right hand man of Rashesh. The letter goes on to talk about alleged foreign exchange violation by Edelweiss Financial Services and Chairman Rashesh Shah with the help of Sanjay Shah.
"Media reports suggest that Mr. Sanjay Nathalal Shah, Chartered Accountant and an independent director of a few of our group companies, is alleged to be connected to Capstone. Let me reiterate that he has no other association with the Edelweiss Group, nor is he in any way related to me; you will appreciate that Shah is a common name," Rashesh Shah stated.
Rashesh Shah also bemoaned the way media has associated Edelweiss group with Capstone. "The media has sensationally reported false allegations, conjecture and innuendo. Several have done so without following the standard, responsible practice of first speaking with Edelweiss. Had they done so, you would have been presented with both sides of the story, equally and fairly. We are, therefore compelled to take appropriate legal action against the concerned media group, in order to protect and reinforce the reputation of Edelweiss," he said.
Earlier today, the Enforcement Directorate sources revealed that Capstone Forex submitted forged and fake passports and air tickets as proof of customers it had sold foreign exchange to. The financial probe agency said that several shell companies had sent more than Rs 700 crore to Capstone, but could not provide a legitimate reason for the transaction. The agency is now planning to summon several corporates, including names like CG Power Solutions, Indianapolls Hospitality, Consultshah Financial Services, Eros International Media, Jain Energy, Navarkar Builders and Next Gen Films, for questioning.