Concast Steel & Power Money Laundering Case: ED Attaches Assets of Rs210.07 Crore

Moneylife Digital Team 11 February 2025

Economy & Nation

The Kolkata zonal office of the directorate of enforcement (ED) has provisionally attached immovable properties worth Rs210.07 crore under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, in connection with the money laundering case against Concast Steel & Power Ltd and its associates. Concast Steel and Power group had availed credit facilities from 11 public sector banks (PSBs) and five financial institutions, with a total default of Rs6,210 crore, as the company loan turned into a non-performing asset (NPA) on 30 September 2016.

The attached assets include residential properties, office spaces, land, and commercial shops across West Bengal, all of which are beneficially owned by Concast group's chairman and managing director (CMD), Sanjay Kumar Sureka.

ED launched its probe based on a first information report (FIR) registered by the banking securities fraud branch (BSFB) of central bureau of investigation (CBI) filed the first information report under various sections of the Indian Penal Code (IPC) and Prevention of Corruption Act against promoter Sanjay Sureka and others based on a complaint filed by State Bank of India (SBI), the lead bank of the consortium.

The FIR alleged that Concast Steel & Power, along with its promoters and directors, engaged in fraudulent activities, including the diversion and siphoning of funds, submission of inflated stock statements, and manipulation of balance sheets. The accused reportedly defrauded banks and financial institutions to Rs6,210.72 crore, excluding interest.

Concast Steel & Power, promoted by Sanjay Sureka and headquartered in Kolkata, operated integrated manufacturing facilities in West Bengal, Odisha and Andhra Pradesh. The company specialises in producing sponge iron, pig iron, mild steel, rolled products, TMT bars, angles, channels and ferroalloys.

The company availed multiple credit facilities, including term loans, cash credit (CC), and letters of credit (LC) from a consortium of banks. However, most of these LCs later devolved, with the majority being opened in the names of related parties. Investigations revealed that funds from these LCs were systematically diverted to accounts of group companies and personal accounts.

During the probe, ED discovered that Sanjay Sureka had created a complex network of shell companies, using the names of employees, relatives and associates to launder funds. These funds were subsequently used for personal expenses and acquiring multiple immovable properties.

In December 2024, ED conducted search operations at 13 places of Concast Steel and Power Group under PMLA. During the search operations, various incriminating documents, digital evidence, gold and jewellery worth Rs4.5 crore and eight vehicles, including luxury vehicles, were found and seized, the agency says.

ED, Kolkata has conducted search operations at 13 places of Concast Steel and Power Group under the provisions of PMLA, 2002 in connection with Bank Fraud case. During the search operations, various incriminating documents, digital evidences, gold and jewellery worth Rs 4.5 Crore… pic.twitter.com/18XbN3FgYD
— ED (@dir_ed) December 18, 2024