The top brass at Cox & Kings (C&K) has been issued a lookout circular (LoC) by the Mumbai Police. The circulars were issued against promoter Ajay Ajit Peter Kerkar, former director Urrshila Kerkar, Chief Financial Officer Anil Khandelwal along with two others from the company. LoCs are issued by the authorities to determine if a person looking to travel is wanted by the police or other law enforcement agencies.
This comes as the Mumbai Police’s Economic Offences Wing is currently looking into complaints filed by the banks as well as Kerkar and other former executives, who in turn are blaming each other of causing losses.
An official familiar with the department sad - “The LoC has been opened as a precautionary measure to ensure that the accused don’t flee the country. It is based on the first information report filed by Kotak Mahindra Bank against the promoters and erstwhile directors of Cox & Kings.”
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Kotak Mahindra Bank was one of the complainants against Cox & Kings. The bank accused the directors and former directors of the company of committing fraud valued at over Rs 170 crores. In return, Kerkar filed FIRs against some former company execs as well as the banks accusing them of being responsible for a loss of Rs 5,500 crores borne by the company and its affiliates.
Following the complaint from the banks, the police had searched the residences and offices of some former directors as well as Kerkar and Khandelwal. As per data submitted by the banks, Cox & Kings owes Rs 3,642 crore to the bank.
In addition to these investigations, the Enforcement Directorate (ED) is looking into a money laundering case against the company which pertains to the fraud caused to Yes Bank. With this backdrop, the ED arrested the company’s internal auditor Naresh Jain as well as the CFO Anil Khandelwal recently.
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The probe further revealed that around Rs 3,908 crores worth of sales were made to 15 non-existent or made-up customers between 2015-19.
The company was also shown to have created several layers of offshore and onshore subsidiaries who borrowed over Rs 3,000 crores from Yes Bank only to divert the funds to companies or entities owned by the promoters of Cox & Kings.
Additionally, Cox & Kings diverted Rs 1,100 crores to a stressed company which has no business relationship with C&K. Around 147 customers of the company didn’t even exist.
Upon the arrests of Naresh Jain and Anil Khandelwal, the ED learnt that the two purchased mortgaged property valued at Rs 63 crores under their own entity known as Reward Business Solutions. “This was without paying a penny from their pocket. Khandelwal and Jain purchased various immovable properties from the funds diverted from CKL and its group firms,” the ED said.
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