After the arrest of IL&FS Vice Chairman Hari Sankaran, the Serious Fraud Investigation Office made its second arrest in the matter by arresting the Former MD & CEO Ramesh Bawa.
On the arrest of Sankaran an official source had said, “Hari Sankaran has been arrested on the grounds of abusing his powers in IL&FS Financial Services Ltd. through fraudulent conduct. He also granted loans to entities which were not creditworthy or have been declared Non-Performing Assets and caused wrongful loss to the company and its creditors.”
The IL&FS has a borrowing of Rs. 18,800 crores of which Rs. 10,700 crore is to external companies and the rest to group companies.
Earlier The Enforcement Directorate had registered a case against Bawa, Sankaran, Ravi Parthsarthy, ILFS Rail Ltd and ILF Transportation Networks on charges of money laundering.
The alleged financial irregularities at IL&FS came to light last year after some group entities defaulted on debt repayments. The government, which superseded the company’s board, is working on a resolution plan now.