The Enforcement Directorate (ED) has started a preliminary probe to look into the allegations of possible violations of the Foreign Exchange Management Act (FEMA) against arms dealer Abhishek Verma, who is in the custody of CBI.
The CBI has registered an FIR against Verma for allegedly getting kickbacks to get Switzerland-based company Rheinmetall Air Defence AG off the Indian government's blacklist.
According to sources, ED investigators are in touch with Abhishek's now estranged US-based attorney C Edmond Allen. Allen has provided the ED documents related to escrow accounts of nearly US $ 410 million of a New York-based firm.
An escrow account is a separate bank account for keeping money that is the property of others. Lawyers keep the escrow account to avoid mingling of client's money with their own funds.
“The ED is reviewing the documents provided by Allen to see whether it is a FEMA violation,” said a source.
Besides the FEMA probe, the ED has also seized off the FIR registered by the CBI in the Rheinmetall case to look for possible violation of money laundering law.
According to sources, the CBI has alleged that when the government was in the process of blacklisting Rheinmetall on the allegations of using corrupt practices, Abhishek Verma got in touch with its representatives and assured them of help by influencing the public servants to stall the process of blacklisting.