The Directorate of Enforcement (ED) has discovered 98 suspected fake partnership firms and 12 private limited companies while investigating illegal foreign remittances. The accused allegedly utilised freight costs as a cover to transfer more than Rs 10,000 crore to organisations in Singapore, Thailand and Hong Kong.

Officials said that the transactions, which were carried out using 269 bank accounts created in the names of shell companies, exposed a sophisticated financial fraud scheme. The agency disclosed the information about a week after its Mumbai zonal office searched eleven addresses in Mumbai, Thane and Varanasi on January 2 in connection with an unlawful foreign transfers case under the Prevention of Money Laundering Act (PMLA), 2002. Around Rs 1 crore worth of movable goods, including cash and jewellery, were found during the search. Digital devices and other incriminating documents pertaining to transactions involving real estate have been discovered and confiscated during the search process.

The ED opened a probe after Thane Police filed a First Information Report (FIR) against Jitendra Pandey and other individuals. "They are accused of making remittances in excess of Rs 10,000 crore to entities in Hongkong, Singapore and Thailand in the guise of freight charges through a web of bank accounts opened in the name of shell entities," said the ED. Jitendra Pandey and several others were taken into custody by the Economic Offences Wing (EOW) of the Thane Police. "ED investigation has so far revealed that the accused persons set up 98 dummy partnership firms and 12 private limited companies and opened about 269 bank accounts in their name to execute such illicit financial transactions through them," the federal agency said.

The ED stated that the search operations revealed a network of RTGS entry operators. These operators arranged RTGS transactions into the bank accounts of partnership firms, which were then routed through the accounts of shell entities to hide the original source of the funds. The agency further explained that the money was eventually transferred to the bank accounts of 12 private limited companies, supposedly involved in freight and logistics, and sent abroad under the pretence of freight charges. "Role of several chartered accountants helping the accused in incorporation of the companies and with the regulatory compliances including ROC filing etc, Form 15 CA has also emerged," added the agency.