Reebok fraud case: ED begins money laundering probe
New Delhi: The Enforcement Directorate has begun a money laundering probe into the alleged Rs 870 crore corporate fraud in sports apparel company Reebok India.
With the registration of this new case, under the provisions of the Prevention of Money Laundering Act (PMLA), the ED has become the fourth agency to probe the purported fraud.
Earlier, the Income Tax department under Finance Ministry, the Serious Fraud Investigation Office (SFIO) under Corporate Affairs Ministry and the Economic Offences Wing of Gurgaon police had probed against the firm and its officials based here.
The ED, according to sources, has begun scrutinising the financial documents and bank statements of the firm and its businesses in India and it is in touch with the other agencies with regard to the probe.
"Enforcement Directorate had through a notice requested Reebok India Company to provide certain information. The Company has and will continue to extend full cooperation to all investigating authorities involved in this matter," Reebok India said in a statement.
Investigators, after their probe till now, have hinted to an alleged connivance of the company officials and its employees.
In the much-publicised criminal complaint filed at the Gurgaon police's Economic Offence Wing in May, the company had alleged that its former Managing Director Subhinder Singh Prem and Chief Operating Officer Vishnu Bhagat were involved in the Rs 870-crore fraud by indulging in "criminal conspiracy" and "fraudulent" practices over a period of time.
In their probe till now, the agencies have also detected that some of the officials of the company could have been involved in the inflation of bills and over-valuation of the goods of the firm.
The ED, according to sources, may also attach the bank accounts and properties of individuals involved in the case after identifying the "proceeds of crime".
The ED, meanwhile, is also probing alleged violations of foreign exchange rules by the company since 2006 and has asked the firm to provide RBI clearances it received in this regard.