ED arrests Director of one of Chinese entities Hoewelai Jinsu in a money laundering case

The Enforcement Directorate (ED) has arrested Anup Nagaral, the Director of one of the entities of Hong Kong-based Hoewelai Jinsu firm, under the Prevention of Money Laundering Act (PMLA) in a case connected with fraud committed on banks under the guise of Merchant Trade.

As Nagaral was not appearing before the PMLA court for trial, a Special PMLA Court issued a warrant of arrest against him on December 31 last year.

ED said that the warrant has been executed. Following the arrest, Nagaral was produced before the court which has ordered Judicial custody of the accused till January 17.

Nagaral is the Director of one of the entities Hoewelai Jinsu, Hong Kong, SAR, China Ltd in the buyer leg of tripartite merchandise trade.

He is one of the accused in the prosecution complaint filed by the ED. Letters Rogatory was issued for serving of summons to Nagaral on July 28 last year.

Further, Nagaral returned to India and appeared before the Central Bureau of Investigation (CBI). The CBI arrested Nagaral in December last year and produced him before CBI court where he was enlarged on bail.

The case linked to a case in which ED initiated a money-laundering investigation on July 18, 2009, on the basis of the First Information Report (FIR) registered by the High Ground Police Station in Bengaluru City.

Investigation revealed that Future Metals Private Limited (FMPL) and Future Exim India Private Limited (FEIPL) didn't honor the tripartite agreements that they had entered with Spice trading corporation Ltd (STCL) and overseas buyers and sellers.

FMPL and FEIPL had guaranteed the payments to be made by the overseas buyers. Naveen Sriram, Chairman of FMPL and FEIPL, and Sudheer Sriram, Managing Director of FMPL and FEIPL had executed a deed of Personal and Corporate Guarantee in favour of STCL against the latter agreeing to provide finance for the Merchandise trade transactions and this corporate guarantee could be invoked by STCL in the event of any default in repayment of the amount due to STCL.

STCL established an irrevocable Letter of Credits (LCs) for the usance period of 90 days. However, the LCs were devolved due to non-payment by overseas buyers which was guaranteed by FMPL and FEIPL causing wrongful loss of US$ 249.572 Million to STCL.

Assets worth Rs 185.67 crore have already been attached under PMLA. The attached proceeds of crime are immovable properties located in Maharashtra, Punjab, New Delhi, Gujarat, Bangalore, and Bellary.

A prosecution Complaint has been filed dated March 1, 2019, before Special Court under PMLA in Bangalore.

( With inputs from ANI )