ED Seizes Rs 1,000 Cr Assets Of Chennai Firm In Major Money Laundering Probe
The money laundering probe originates from a CBI investigation into RKMPPL’s acquisition of the Fatehpur East Coal Block, which was allocated by the Ministry of Coal for power generation.
The Enforcement Directorate (ED) has seized assets worth Rs 1,000 crore following searches against Chennai-based RKM Powergen Private Limited (RKMPPL) and its associates in connection with an alleged fraudulent coal block acquisition in Chhattisgarh.
The money laundering probe originates from a CBI investigation into RKMPPL’s acquisition of the Fatehpur East Coal Block, which was allocated by the Ministry of Coal for power generation, reported PTI. The ED conducted raids on the company’s premises and individuals linked to the case, including Andal Arumugam and S Arumugam. However, the agency has not disclosed the exact date of the searches.
Taking to X, "ED, Chennai has conducted search operations at three locations in Chennai, targeting premises linked to Smt. Andal Arumugam, S. Arumugam and others as part of the ongoing investigation into M/s RKM Powergen Private Limited (RKMPPL) under the provisions of PMLA, 2002. During the search operations, various incriminating documents, digital devices and documents related to immovable properties, collectively valued at approximately Rs. 1000 Crore were seized and fixed deposit receipts (FDRs) and Mutual funds amounting to Rs 912 Crore were also freezed."
ED, Chennai has conducted search operations at three locations in Chennai, targeting premises linked to Smt. Andal Arumugam, S. Arumugam and others as part of the ongoing investigation into M/s RKM Powergen Private Limited (RKMPPL) under the provisions of PMLA, 2002. During the…
— ED (@dir_ed) February 4, 2025
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According to ED, RKMPPL secured a loan from Power Finance Corporation (PFC) using the coal block allocation and allegedly diverted a significant portion of Rs 3,800 crore to a foreign entity named MIPP, controlled by RKMPPL, for the purchase of over-valued plant and machinery.
Additionally, the company allotted 26% shares to Malaysia-based Mudajaya Corporation Bhd. and 10.95% to Enerk International Holdings Ltd. at a premium of Rs 240 per share, while 63.05% of shares were allotted at face value, raising concerns about transparency in valuation, as per the report.
Investigators found that Mudajaya Corporation allegedly funneled back project funds intended for equipment procurement through its subsidiary MIIP International, resulting in Rs 1,800 crore being routed back to RKMPPL under the guise of equity participation.
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