ED files charge sheet against Sharp long Consultants

Mumbai: The Enforcement Directorate (ED) has filed a charge sheet against Sharp Long Consultants Limited registered with British Virgin Islands.

The Sharp Long Consultants was among the names revealed in Panama Papers leak, Indian Express reported.

The consultant’s director Dinesh Jajodia, firm’s managing director and chairman Pankaj Srivastava along with CA and tax consultant of Geodesic Limited (GL) Prashant Mulekar and IIM-Lucknow alumnus Kiran Kulkarni were all arrested for creating shell companies and allegedly cheating, defrauding its shareholders and Foreign Currency Convertible Bond (FCCB) holders of the company involving an amount of US $125 million.

Jajodia and Mulekar are in judicial custody while Kulkarni and Srivastava are in ED custody.

“The accused have been chargesheeted under Sections 3 and 4 of the Prevention of Money Laundering Act (PMLA) and the prosecution complaint was filed against the four arrested accused and eight firms on Friday,” said a senior official.

The accused collected foreign funds through FCCB but failed to repay the amount to their London-based bank who acted as the firm’s trustee. Jajodia was the authorized signatory of various overseas companies.

The ED claimed, “Jajodia hatched a criminal conspiracy to defraud the shareholders as well as FCCB holders (overseas investors) by creating a web of shell companies in various countries through fictitious dealings in order to receive wrongful gains.”

The chargesheet states these accused caused “wrongful gain for themselves and wrongful loss to shareholders and FCCB holders of M/s Geodesic Limited (GL), siphoned off shareholders’ funds to the tune of Rs 250 crore by showing bogus purchases of software and failed to redeem Foreign Currency Convertible Bonds worth US$ 125 million (approx Rs 812 crore) to FCCB holders by creating a web of shell companies in various countries with the malafide intention of siphoning off the money”.

The firm raised US $125 million through foreign bonds, which were first credited in the overseas account of London’s Citibank of GL and subsequently transferred to overseas subsidiaries such as Geodesic Holdings Limited, Mauritius and Geodesic Technology Solutions Limited (GTSl), Honk Kong.

“On maturity, Geodesic Ltd had failed to adhere to the commitment given to Citibank, London, for repayment of the amount totalling USD 157.06 million,” it said.