ED gathers pace on money laundering probe against Vijay Mallya; seeks details on overseas assets

New Delhi: As the money laundering probe against embattled liquor baron Vijay Mallya gathers pace, the Enforcement Directorate (ED) is preparing to issue Letters Rogatories (LRs) to a certain countries, including South Africa and the UK, for obtaining information on his overseas assets.

Official sources said the agency has obtained details about immovable and movable assets held by the United Breweries (UB) Chairman in a number of countries and investigators are looking at countries like South Africa, the United Kingdom, the United States of America, Hong Kong and France, as part of its probe conducted till now in the case.

The agency is mulling moving a competent court in this regard and obtain the LRs (judicial requests) which will be sent to their counterparts in these countries for obtaining information with regard to purchase, registration and status of movable and immovable assets.

The agency, meanwhile, has also written to the Reserve Bank of India (RBI) to understand the nuances of a 2010 policy decision to widen the corporate debt restructuring scheme to include the aviation industry.

The policy was used by a few airlines, including Kingfisher Airlines (KFA), to restructure its debts.

The sources said as there are not many assets of Mallya available for attachment under anti-money laundering laws in the country following banks putting their claims on them, his and KFA's foreign assets can be seized.

The agency, while probing the "proceeds of crime" generated in the case of an alleged loan fraud of Rs 900 crore on IDBI bank, will also need to have a comprehensive data on what properties were raised by the businessman, his companies and associates abroad.

ED is also probing allegations that about Rs 300 crore were diverted to foreign shores out of this loans and hence LRs will help obtain details about their end-user in the foreign countries, the sources said.
However, a senior official said getting an LR issued from a court is a first step.

It takes time to follow it up with the foreign agencies but as the case is being probed under the criminal provisions of the Prevention of Money Laundering Act, required cooperation is expected.

The agency, which has already questioned a few KFA and IDBI executives in the case, had yesterday issued fresh summons to Mallya to appear before its investigators in Mumbai on April 9.

Mallya is understood to have informed the ED investigating officer that cases related to bank loans were currently subjudice in the Supreme Court and he was trying to settle these loans with the help of his legal and corporate team and, hence, would require some more time.

Mallya was first summoned by the agency to "appear in person" at its office in Mumbai on March 18 but he sought more time citing his prior engagements, following which the agency asked him to depose on April 2.

Mallya and KFA had on March 30 submitted to the Supreme Court in a sealed cover a proposal for repayment of Rs 4,000 crore out of the loan amount of Rs 6,903 crore to a consortium of banks, led by State Bank of India, by September this year.

He is reported to be in the UK after he left India on March 2.

ED has registered a money laundering case against Mallya and others, based on an FIR registered last year by CBI.

The agency is also investigating financial structure of the now-defunct KFA and looking into if there was any payment of kickbacks to secure loan.