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SFIO Arrests Former Bhushan Steel Promoter Neeraj Singhal for Fund Mismanagement

Bhushan Steel

The ex Bhushan Steel promoter allegedly siphoned off Rs 2000 crores using 80 companies.

Guwahati: In its very arrest for a financial fraud, the Serious Fraud Investigation Office (SFIO) has arrested ex-promoter and Managing Director of Bhushan Steel, Neeraj Singal for an alleged fraud of Rs 2000 crores

Singal has allegedly siphoned off Rs 2000 crores according to official sources of SFIO. The former Bhushan Steel promoter was produced before the court on Tuesday and has been sent to judicial custody till August 14.

In a statement, the Ministry of Corporate Affairs (MCA) said that the arrest came as a part of SFIO’ s investigation into the affairs of Bhushan Steel Limited and its several other companies. The MCA had received complains regarding the organisation and had directed the SFIO to carry out an investigation.

The MCA release said that the erstwhile promoters of Bhushan Steel have used several complex fraudulent manoeuvres to divert funds amounting thousands of crores., which were revealed during the course of the investigation.

The SFIO is the Government’s arm that looks into complex financial frauds. Their investigations on Bhushan Steel revealed that the ex-promoter was involved in serious corporate frauds punishable under Section 212(8) of the Corporate Act, 2013.

Reacting to Singhal’s arrest, Financial Services Secretary Rajiv Kumar said that it is time for those involved in fraud and loan diversion to face the music.

Tagging PMO India, Finance Minister of India and the Press Information Bureau, Singh tweeted,

“Another blow to Crony capitalism. No mercy for siphoning off Public money. Arrest of ex promoter of Bhushan SL -zero tolerance of Govt. to fraudsters & economic offenders #CleanBanking, ?? ???? ?? ????. #NPA Recoveries and action to continue.

The MCA in its statement lambasted ex-promoters and Directors of Bhushan Steel saying that they did not participate in the investigation process, did not appear before the investigating team, and also tried to veil facts.

Bhushan Steel ‘s ownership has been transferred to the TATA Steel on May 18, following an insolvency resolution.TATA settled nearly two-thirds or Rs 32,500 crores that the firm owed to banks and acquired a stake of 72.65%.

The Finance Ministry has also tweeted that Singhal is accused of siphoning of funds worth rs 2000 crores by using more than 80 companies. The Ministry further stated that fraudulent activities of Bhushan Steel have led to its insolvency.