Investor Fraud: Promoter Declared Fugitive Economic Offender

New Delhi, Sep 26 (PTI) The Enforcement Directorate will soon begin "confiscation" of assets of a promoter of a Lucknow-based company which is alleged to have duped numerous investors to the tune of about Rs 800-1,000 crore as a court has taken cognisance of its plea to declare him a fugitive economic offender.

The federal agency said in a statement on Thursday that a special Prevention of Money Laundering Act (PMLA) court in Lucknow has "accepted" its application made against prime accused Rashid Naseem, the promoter of Shine City Group .

The plea was made by the ED under section 4 of the Fugitive Economic Offender Act (FEOA), 2018 and the court took its cognisance on Wednesday, it said.

The ED, as part of the same application, also prayed for confiscation of the movable and immovable assets of Naseem, his associates and companies controlled by them worth Rs 127.98 crore.

Officials said if Naseem does not appear before the said court on the scheduled date of November 5, he could be declared a fugitive economic offender leading to confiscation of his assets.

Diamantaire Nirav Modi and liquor businessman Vijay Mallya are among the dozen people who have been declared fugitive economic offenders till now.

Naseem, as per the ED, left India sometime back and it is "conclusively ascertained" that he is residing in Dubai, United Arab Emirates (UAE).

The agency alleged he was "not returning to India to face the due process of law" even as a non-bailable warrant (NBW), a Look Out Circular (LOC) and a Interpol Red Notice has been issued against him.

The money laundering case stems from as many as 554 FIRs registered by the Uttar Pradesh Police against Naseem, Shine City Group of Companies and its executives on the charges that they collected about Rs 800-1,000 crore from the public in the name of investment.

"They promised huge returns on such investments and finally cheated the investors by committing fraud," the ED claimed.

Naseem, as per the agency, has been found "to be involved" in the offence of money laundering. It has arrested eight persons, filed four charge sheets apart from attaching various assets worth Rs 189.39 crore.

The FEOA was enacted by the Narendra Modi government in 2018 to cripple those who are charged with high-value economic frauds and abscond from the country to evade the law.

The ED, as per the data, filed a total of 19 such applications before the designated special PMLA courts in the country following which 12 persons have been declared fugitive economic offenders till now.

These also include Nitin Jayantilal Sandesara, Chetan Jayantilal Sandesara, Dipti Chetan Jayantilal Sandesara, Hitesh Kumar Narendrabhai Patel, Junaid Iqbal Memon, Hajra Iqbal Memon, Asif Iqbal Memon and Ramachandran Vishwanathan.