HYDERABAD: Enforcement Directorate (ED) said on Sunday that Hyderabad-based jeweller Sanjay Agarwal was arrested in connection with an alleged loan fraud case in which the State Bank of India, Hyderabad, suffered a loss of Rs 67 crore.
According to ED, Agarwal, Managing Partner of Ghanshyam Gems and Jewels was arrested on Friday under the Prevention of Money Laundering Act, 2002 (PMLA) for fraudulently procuring gold bullion from SBI by producing forged bank guarantees and covering letters purportedly issued by PNB and selling the gold bullion in local market to various jewellers and small traders in cash during 2010-11 period.
ED took up the investigation based on an FIR registered by the Central Bureau of Investigation (CBI), Bengaluru, under various IPC Sections.
“Subsequently, CBI registered another FIR against Sanjay Agarwal and others relating to fraudulently removing gold and jewellery hypothecated to PNB against gold loan availed by his firm and thereby causing a loss of Rs 31.97 crore to the PNB,” the ED said.
Investigations revealed how he procured gold bullion from SBI bank while he was doing wholesale gold trading. He sold the gold bullion to various traders for cash and the generated cash from the bullion was diverted to several other firms floated by Sanjay Agarwal in the name of his wife, brothers and his employees, the ED said.
“Later, after default on the gold loan happened, SBI made out that the required papers submitted by Awarwal were forged. Agarwal and his brothers, Ajay and Vinay clandestinely removed the entire gold-stock kept at their store in Abids. The stock was already hypothecated to the PNB against gold loan availed by the firm, it said.