In yet another financial fraud case this year, the Enforcement Directorate (ED) has recently seized a dozen cars including a few high-end luxury models. This move is linked with Housing Development and Infrastructure Limited and PMC bank loan scam. The enforcement agency seized a total of 12 cars from the residence of the father-son duo Rakesh Wadhawan and Sarang Wadhawan, both of whom are promoters of HDIL and among the main players in this case. The ED has in past impounded high-end luxury cars of other absconding businessmen involved in financial frauds too, including the likes of Nirav Modi and Vijay Mallya.
The cars in question include the likes of the Rolls Royce Phantom, Bentley Continental GT, another Rolls Royce model, Mercedes-Benz S Class, two Range Rover SUVs, and a BMW. These were among the dozen cars seized by the Enforcement Directorate during their raids at six places in Mumbai. Other cars seized by the ED include a Mahindra Bolero, two Mahindra Scorpio SUVs, a Toyota Qualis and a Hindustan Motors Ambassador. The images here, courtesy DNA, show the cars that have been seized. The at six places where the ED carried out raids include HDIL`s head office at Bandra (East) and residence of Rakesh Wadhawan, which is known as Wadhawan House at in Bandra (West).
Talking about the case which led to this move by ED, the Wadhawans have been accused of not repaying loans up to Rs. 6,500 crore to Punjab and Maharashtra Cooperative (PMC) Bank. They have been arrested for the same and will be kept in police custody till October 9. They, along with senior bank officials allegedly colluded to cheat the bank. Further, the Enforcement Directorate has also filed a case of money laundering against the promoters and the senior bank officials. The agency’s case is based on an FIR filed by the Economic Offences Wing (EOW) of Mumbai police.
The Punjab and Maharashtra Cooperative (PMC) Bank lent Rs. 4,000 crore or 75 per cent of its entire loan book to the now-bankrupt HDIL. The two promoters allegedly created 21,000 fake accounts to camouflage the loans from PMC. Moreover, HDIL continued to default on loans while PMC Bank allegedly did not mention the matter in its annual report and kept giving loans despite the company being taken for insolvency. The suspended managing director of PMC bank, Joy Thomas, was also arrested in the alleged Rs. 6,500 crore fraud case.
Coming to the cars that have been seized, they don’t hold up any value when compared to the scam but as per the procedure, they have been seized from the Wadhawans. Coming to the question of what would happen to them, the ED is most likely to conduct an auction of all these cars and sell them to the highest bidder. This will happen sometime later though after a few complications regarding the case have been solved. In the worst scenario, these cars could gather dust at the local police stations for a few months as has been the case with DSK cars.
A few months back, seized cars of Nirav Modi were auctioned off. His collection also included several high-end names including a Rolls Royce Ghost, Porsche Panamera, and Mercedes-Benz CLS among others. Expect a notification regarding the sale to be issued in the coming months and it will be a good opportunity to grab some of these high-end cars for cheap.