ED conducts raids in Mumbai, Goa in forex violations case | Mumbai news - Hindustan Times
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ED conducts raids in Mumbai, Goa in forex violations case

Jul 06, 2024 11:17 AM IST

The agency initiated its probe based on information suggesting that the three entities had allegedly diverted $228 million to certain overseas entities

Mumbai: The Enforcement Directorate (ED) has recently conducted searches in Mumbai and Goa as part of an investigation into alleged violations of the Foreign Exchange Management Act by Chowgule and Company Private Limited (CCPL), a Goa-based business group, and two other firms.

ED officials carried out searches at the premises of CCPL, Chowgule Steamship Limited (CSL), and PP Mahatme and Company
ED officials carried out searches at the premises of CCPL, Chowgule Steamship Limited (CSL), and PP Mahatme and Company

The agency initiated its probe based on information suggesting that the three entities had allegedly diverted $228 million to certain overseas entities over several years. ED officials carried out searches at the premises of CCPL, Chowgule Steamship Limited (CSL), and PP Mahatme and Company, according to agency sources.

The operation also included searches at seven residential premises belonging to members of the Chowgule family, their group chartered accountant, and the former managing director and chief financial officer of CSL at various locations in Goa and Mumbai.

"Credible information revealed that the said entities had created various offshore structures in which approximately $228 million were diverted from Indian companies over the years," an ED source disclosed. The alleged diversion reportedly involved routing funds through multiple foreign subsidiaries and step-down subsidiaries based in Guernsey, United Kingdom, and Marshall Islands.

During the searches, the ED seized what it described as "incriminating documents" and digital devices, which are currently under scrutiny.

This investigation highlights the ongoing efforts by Indian financial enforcement agencies to curb potential forex violations and offshore fund diversions. The case underscores the complex web of international financial transactions that authorities must navigate in their pursuit of regulatory compliance.

The Chowgule Group, a prominent business conglomerate with interests spanning mining, shipbuilding, and real estate, now finds itself at the centre of this high-profile investigation. As the probe unfolds, it may have significant implications for the group's operations and the broader business community's approach to international financial transactions.

The ED's actions reflect a growing trend of increased scrutiny on cross-border financial flows, particularly those involving tax havens and complex corporate structures. As the investigation progresses, it may shed light on the challenges of regulating international business operations in an increasingly interconnected global economy.

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