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Saturday, Dec 14, 2019

UPPCL employees’ PF investment scam: Brokerage firms with fake addresses were paid huge commission, say EOW officials

The officials said total nine brokerage firms with fake addresses were picked by UPPCL authorities to assist them in investing the fund. The investigators have identified four proprietors of such firms.

lucknow Updated: Nov 13, 2019 20:42 IST
HT Correspondent
HT Correspondent
Hindustan Times, Lucknow
Businessman taking pile of money, Indian Rupee banknotes, on his desk in a dark office - corruption concept
Businessman taking pile of money, Indian Rupee banknotes, on his desk in a dark office - corruption concept(Getty Images/iStockphoto)
         

An investigation by the UP Police’s Economic Offences Wing (EOW) on Wednesday revealed that a huge amount was paid to nine brokerage firms with fake addresses floated to invest Rs 4,122.5 crore of UPPCL employees’ provident fund in multiple short-term fixed deposits with the Mumbai-based Dewan Housing Finance Corporation Limited (DHFL) since March 2017, said senior EOW officials.

The officials said total nine brokerage firms with fake addresses were picked by UPPCL authorities to assist them in investing the fund. The investigators have identified four proprietors of such firms.

Moreover, all these promoters of the firms had links with some UPPCL officials and further investigation was expected reveal the entire nexus, he added.

A senior EOW official said details of proprietors of four brokerage firms were obtained while questioning UPPCL employees’ trust former secretary Praveen Kumar Gupta’s son Abihnav Gupta, whose role is also suspected in roping in the brokerage firms.

He said Abhinav was still being questioned to obtain more details about other key persons involved in the entire investment process.

He said Abhinav’s father Praveen Kumar Gupta, along with former UPPCL managing director AP Mishra and former director finance Sudhanshu Dwivedi, had already been arrested.

“Abhinav could also be arrested if substantial evidence is found against his direct involvement in the scam,” he said.

Elaborating on the bank transactions, the official said DHFL regional head of Uttar Pradesh had shared details of dozen bank accounts in which the brokerage commission amount was transferred from time to time. He said the EOW teams will further scan the details of all bank accounts to know details about the operators.

Officials privy to the probe said Abhinav was questioned for several hours about the investment and was still in custody for further interrogation. Earlier, EOW officials said addresses of nine of the total 14 investment brokerage firms hired by UPPCL authorities for investment of employees’ provident fund were fake. These 14 firms were hired by UPPCL authorities from March 2017 onwards, said an EOW official.

They said investment through brokerage firms was revealed during interrogation of former UPPCL managing director AP Mishra, director of finance Sudhanshu Dwivedi and Praveen Gupta, who were earlier taken into police custody.

A total of Rs 4,122.5 crore (Rs 41.2 billion) of employees’ provident fund was invested in DHFL in multiple short-term fixed deposits. Till September,Rs 1,854.3 crore had been recovered on maturation of FDs. However, Rs 2,268 crore remains with the private firm that came under the scanner of the Enforcement Directorate in October over its alleged ties to Iqbal Mirchi, Dawood Ibrahim’s alleged aide.