In a major crackdown on assets acquired through alleged illicit means, India's Enforcement Directorate (ED) has attached a high-value property in central London, situated close to the iconic Buckingham Palace. The provisional attachment, made under the Prevention of Money Laundering Act (PMLA), targets an asset valued at approximately Rs 150 crore (around £14.5 million).
The Sterling Biotech Bank Fraud Nexus
This action is directly linked to the ongoing investigation into a massive Rs 5,000 crore bank fraud case involving the promoters of the Sterling Biotech group. The ED's probe has meticulously traced a complex web of financial transactions where funds, allegedly syphoned off from Indian banks through fraudulent means, were funneled overseas to acquire premium real estate.
The attached London property is registered in the name of a company based in the British Virgin Islands, a well-known offshore financial centre. Investigators have established that this offshore entity is beneficially owned and controlled by the Sandesara brothers – Nitin Sandesara and Chetan Sandesara – who are the prime accused and promoters of Sterling Biotech. The Sandesaras are currently believed to be absconding.
Modus Operandi and the Larger Scam
The ED's case stems from multiple FIRs registered by the CBI against Sterling Biotech Ltd, Sterling International Enterprises Ltd, and their promoters. The central allegation is that the companies and their promoters obtained huge loans from a consortium of banks, led by the Andhra Bank, through fraudulent means including the fabrication of documents and forgery.
The modus operandi involved creating a network of more than 250 domestic and offshore shell companies. These entities were used to rotate funds, inflate balance sheets, and subsequently divert the loan amounts for purposes other than those stated. A significant portion of these funds was allegedly laundered out of India to purchase assets like the London property.
The total proceeds of crime in this PMLA case are pegged at a staggering Rs 8,100 crore. The attachment of the London asset marks a critical step in the agency's efforts to identify and seize properties acquired with these laundered funds across global jurisdictions.
International Cooperation and Legal Proceedings
The identification and provisional attachment of this high-value overseas asset underscore the ED's increasing reliance on international legal cooperation. The agency has been actively sharing information and seeking assistance through official channels to track the cross-border movement of illicit funds.
This action also highlights the global reach of India's financial crime investigations. Attaching a property of such prestige and value in one of the world's most expensive real estate markets sends a strong message about the authorities' determination to pursue economic offenders and their assets, regardless of location.
The Sandesara brothers, along with other accused including family members and associates, face serious charges under the PMLA. The ED has previously filed multiple charge sheets in this case and has also declared the promoters as fugitive economic offenders. The latest attachment is expected to be followed by a confirmation process before the Adjudicating Authority of the PMLA in New Delhi.
Implications and the Road Ahead
The provisional attachment freezes the London property, preventing its sale, transfer, or alienation. This move is aimed at preserving the asset so that it can eventually be confiscated by the Indian government, following due legal process, and its value used to repay the debts owed to the defrauded banks.
This case is part of a broader crackdown on high-profile bank frauds in India. It demonstrates the multi-agency approach involving the CBI and ED to tackle complex white-collar crimes that drain public financial institutions. The focus remains on piercing the corporate veil and the layers of offshore holdings to bring the accused to justice and recover the proceeds of crime.
The ED's continued investigation is likely to probe deeper into the financial trails leading to other foreign assets linked to the Sandesaras and their associates, as the agency works to dismantle the entire network used for money laundering in this landmark case.
