The ED on Saturday said it has arrested Sushil P Mantri, director of Bengaluru-based real estate group Mantri Developers Pvt. Ltd., in a money laundering probe linked to alleged duping of numerous homebuyers.
Mantri was produced before a special Prevention of Money Laundering Act (PMLA) court in Bengaluru that sent him to the Enforcement Directorate custody for 10 days, it said in a statement.
The agency said it filed a money laundering case against the group and its promoters in March after studying a Bengaluru police FIR registered against them in 2020.
“Many homebuyers have filed complaint with the police as well as with the ED alleging that accused entities/persons are involved in money laundering and have induced the prospective buyers with rosily painted schemes, showing misleading brochures, falsification of delivery time lines and window dressing and collected more than Rs 1,000 crore as advance money from thousands of buyers.”
“However, they have not been given possession of their flats even after 7-10 years,” the ED alleged.
The company, it said, offered various “Ponzi-like schemes which was named as buy-back plan and advance money was collected for the flats/homes.”
In some cases, the company has not refunded the amount to the buyers even after clear direction of the Real Estate Regulatory Authority (RERA), it said.
Probe found that the amount “collected from the buyers by the company which were meant for construction of the projects have been diverted for personal use by the management of the company or for such other fraudulent purposes and hence the project is stalled.”
Currently, the group has total outstanding loans of about Rs 5,000 crore from various financial institutions, out of which about Rs 1,000 crore is overdue and some of the loan has been termed non-performing asset (NPA), the ED said.
“The company has cross-collateralised its assets to different financial institutions for taking multiple loans on same assets,” it said.