The directorate of enforcement (ED) has alleged that a former deputy vice-president of Kotak Mahindra Bank siphoned off funds belonging to the Municipal Corporation (MC), Panchkula, and used the proceeds to fund a lavish lifestyle, including the purchase of luxury vehicles such as a Porsche Cayenne, multiple BMWs, Jeep Wranglers, a Toyota Land Cruiser and a Harley-Davidson motorcycle.
The agency has provisionally attached assets worth ₹131.13 crore under the Prevention of Money Laundering Act (PMLA), 2002, and filed a prosecution complaint against nine accused before a special court in connection with the alleged bank fraud.
According to ED, the attached assets comprise bank balances of ₹12.85 crore and immovable properties worth ₹118.28 crore. The agency said it had attached 100% of the allegedly embezzled funds of MC Panchkula within four months of the anti-corruption bureau (ACB), Haryana, registering the first information report (FIR).
Fake Accounts Used To Divert Civic Funds
ED launched its money laundering investigation based on an FIR registered by ACB under the Bharatiya Nyaya Sanhita, 2023, and the Prevention of Corruption Act against unknown officials of Kotak Mahindra Bank.
The investigation found that Pushpinder Singh, then deputy vice-president of Kotak Mahindra Bank, allegedly conspired with Vikas Kaushik, an official of MC Panchkula, and bank employee Dilip Raghav to open two unauthorised bank accounts in the name of the municipal corporation using forged documents and fabricated authorisation letters.
According to ED, the accused ignored genuine communications issued by MC Panchkula and instead created parallel authorisation documents to satisfy the Bank's internal procedures. Funds held in legitimate municipal accounts were allegedly transferred to the unauthorised accounts using forged authorisation letters.
The agency further alleged that mobile numbers and email addresses linked to both the genuine and the unauthorised municipal accounts were changed to numbers controlled by Mr Singh and Mr Kaushik. This enabled them to receive transaction confirmations and bypass the bank's internal checks designed to prevent unauthorised fund transfers.
Layering Funds through Intermediaries
Once the money reached the unauthorised accounts, ED alleged it was routed through several individuals, including Rajat Dahra, Swati Tomar, Kapil Kumar, Vinod Kumar and Sonia, as well as business entities such as SK Agrotech and SK Agrofirm, to conceal the origin of the funds.
The investigation found that accounts operated in the names of Rajat Dahra and Swati Tomar were effectively controlled by Mr Singh and were used to transfer money into his personal accounts and those linked to his wife, Preeti Thakur.
The diverted funds were then allegedly used to purchase immovable properties and high-value movable assets, including luxury cars, premium watches and expensive furniture.
Luxury Purchases Alleged
ED said Mr Singh purchased several luxury vehicles using the alleged proceeds of crime, including a Porsche Cayenne, BMW 740Li, BMW X7, another BMW luxury sedan, two Jeep Wranglers purchased in different years, a BMW Z4, a Toyota Land Cruiser and a Harley-Davidson motorcycle.
According to the agency, many of these vehicles were sold to third parties after the alleged fraud came to light.
Investigators also alleged that Mr Singh attempted to shield assets from attachment by transferring a property in Sector 2, Panchkula, to his sister, Gunita Sethi. The purchase money allegedly originated from Chaudhary & Sethi Legal Advisory Pvt Ltd, a company owned by his wife, Ms Thakur.
ED described the transaction as a case of round-tripping intended to disguise ownership and prevent the property from being attached under the PMLA.
Funds Allegedly Used for High-interest Lending
The investigation further revealed that Mr Singh allegedly diverted part of the siphoned money into unsecured private lending.
According to ED, loans were extended to individuals, including Sunny Garg, Priyanka Garg, Samar Mohan Ranga and Aryan Singh, as well as entities such as Sanat Realtors Pvt Ltd, Central Infradevelopers, Sanat Ventures Enterprises LLP, Savage Records Pvt Ltd and Sanat Enterprises Pvt Ltd.
The agency alleged that these loans generated cash interest of about 3% per month, or 36% per year, thereby substantially increasing the alleged proceeds of crime.
ED also claimed that Ms Thakur's income and her company's turnover rose sharply during the period when the alleged fraud was committed. Investigators believe the company was used to dispose of assets acquired using the diverted municipal funds.
Searches, Arrest and Prosecution
Searches conducted by ED on 22 April 2026 at multiple premises linked to the accused resulted in the seizure of documents and other incriminating material.
The agency arrested Mr Singh on 1 June 2026. According to ED, he was remanded to nine days' custodial interrogation by the Special PMLA Court in Panchkula.
ED alleged that Mr Singh played the central role in opening the unauthorised accounts, diverting municipal funds, layering the money through intermediaries, acquiring movable and immovable assets and advancing high-interest loans using the alleged proceeds of crime.
According to the agency, MC Panchkula incurred a loss of ₹107.24 crore, while the total alleged proceeds of crime have been calculated at ₹131.13 crore, including the alleged interest earned on the siphoned funds. The prosecution complaint, filed under Sections 44 and 45 of the PMLA, names nine accused in the money laundering case. ED said further investigation is underway.
