ED approaches Court to allow probe into money laundering case against Naresh Goyal and his wife

The Enforcement Directorate (ED) has approached a local court to be allowed to probe a money-laundering case against Jet Airways founder Naresh Goyal and his wife. The ED contested the Mumbai Police's decision to close a cheating case against the couple.

After the Mumbai police closed the cheating case in June, the ED filed a protest petition, asking the court to not accept the closure report as the federal agency is probing a serious offence of money laundering. The federal agency which probes money-laundering cases, requires a predicate offence, such as the one filed by the Mumbai Police, to conduct its investigation.

The Mumbai Police has however objected to the ED’s protest petition.

In the Court, the ED claimed that the Police had failed to investigate the details of certain offshore accounts provided by the complainant – Akbar Travels of India, in the cheating case. The ED argued that there is evidence of money laundering and not a case of business loss as concluded by the police. The federal agency asserted the essential requisite of recording the statement of the accused in a criminal investigation was also not followed by the local police.

ED’s counsel Hiten Venegaonkar argued that since the Prevention of Money Laundering Act was an evolving law, the scope of definition of “victim” should be widened to include others who have an interest in the case. He also argued that since the federal agency was conducting a parallel probe stemming out of the predicate offence, it had the locus standi to contest the closure report filed by the city police.

The court had last week acceded to the ED’s request to reject the Goyals’ plea opposing the ED’s jurisdiction in filing a protest plea. The ED had argued that the accused couple cannot intervene at this juncture.

In June, the ED filed an intervention application before the court claiming that its probe had revealed that Goyal had misappropriated funds and diverted the money into his wife’s and his personal accounts.

According to the ED, the Police completely ignored the issues of money laundering raised in the complaint. It alleged that Jet Airways and Goyal had bank accounts abroad where money is diverted in an illegal manner and, therefore, it claimed that Jet Airways suffered losses at the cost of enriching Goyal and his family members.

“Police have not recorded the statement of Goyal or confronted him with the complaint. It was imperative that Goyal was confronted with all the allegations and specific facts like bank accounts in foreign countries,” it said.

The ED has unearthed numerous foreign bank accounts allegedly held by the couple abroad, including in the UAE, UK, Switzerland, Singapore and the US. According to the agency, the couple also held eight offshore properties and of financial investments in bonds, but has not explained the source of funds for buying various properties.

It has been alleged by the ED that Goyal was not co-operating with the investigation and is deliberately not obtaining bank statements of these accounts.