Yes Bank founder Rana Kapoor held in connection with ₹200-crore loan to HDIL group

The Enforcement Directorate (ED) on Wednesday arrested Yes Bank founder Rana Kapoor in connection with a money laundering case pertaining to the sanction of a loan of ₹200 crore to Mack Star Marketing Private Limited, owned by Housing Development Infrastructure Limited (HDIL) promoters Rakesh Wadhawan and Sarang Wadhawan.

HDIL’s promoters are accused of unlawfully availing loans from Punjab and Maharashtra Cooperative (PMC) Bank and defrauding it of ₹6,670 crore.

Sources said this is the third money laundering case involving Kapoor which ED is probing. Kapoor was produced in a Prevention of Money Laundering Act (PMLA) court and remanded in ED’s custody till January 30.

ED sources said that during Kapoor’s tenure, Yes Bank sanctioned loans to Mack Star Marketing in an unruly manner. HDIL then utilised this money to clear other loans it had taken from Yes Bank, to ensure that it was not declared as a defaulter. ED suspects that Kapoor was fully aware of the illegal activity and wish to interrogate him regarding the same. Hence, he has been arrested again.

In the same case, the central anti-money laundering agency had last week arrested Mehul Thakur, managing director of realty firm Viva Group, owned by the Bahujan Vikas Aghadi (BVA) chief Hitendra Thakur’s family. BVA is a supporter of the Maharashtra Vikas Aghadi (MVA) government.

Earlier, ED had stated that the Wadhawans and others allegedly diverted ₹200 crore sanctioned by Yes Bank to Mack Star Marketing Pvt Ltd. This loan was allegedly siphoned off by the Wadhawans by showing a fictitious purpose.

The Wadhawans illegally transferred two commercial properties, of Mack Star, valued at ₹34.36 crore, in Kaledonia building, Andheri (East), to Viva Holding, a company of Viva Group. In the sale agreement, the purchase amount was shown to be paid via 37 cheques by Viva Holding to Mack Star Marketing Pvt.

The investigation has revealed that these cheques were never encashed by Mack Star, and Viva Holding never made payments for the purchase of the said properties. The Wadhawans had illegally transferred these properties to Viva Group in violation of the article of association of Mack Star. Further, Viva Holding never showed these properties in its balance sheets.

Kapoor was previously arrested by ED in March 2020 for allegedly wrongfully sanctioning loans to various companies in lieu of kickbacks. Since then he has been in Taloja jail in Navi Mumbai. Recently, the Bombay high court (HC) also rejected Kapoor’s bail application in a loan fraud case. Kapoor, his wife and their three daughters are also accused in the case, and it was alleged that the family received ₹600 crore as kickbacks for unlawfully sanctioning loans from Yes Bank.

Yes Bank had illegally sanctioned huge loans to various high profile borrowers, which later defaulted in repayments. Some of the defaulters include global tour company Cox & Kings and Dewan House Finance Ltd (DHFL).