The Directorate of Enforcement, Chennai, has frozen properties worth ₹48 ​crore of the city-ba​sed Kanishk Gold Pvt Ltd under the Prevention of Money Laundering Act, in a bank fraud case. Kanishk Gold manufactures gold jewellery at its unit at Pukkathurai village in Maduranthagam taluk of Kancheepuram district and markets the same under the brand name ‘KRIZZ’ .

It was alleged that huge bank loans were obtained from a consortium of 14 banks, with SBI as the lead bank, for business purposes. Credit facilities were secured by securities such as raw material, semi-finished goods, finished goods, stores, spares and by showing huge stocks. However, it was later realised that the stock statements were fudged with the help of Chartered Accountants and on inspection by the banks in May 2017, it was found that there were no stocks and effectively all operations came to a standstill, says a press release from ED.

An FIR was registered based on a complaint by the General Manager, State Bank of India, Chennai, alleging offences of forgery, cheating and criminal conspiracy against the accused. According to the Forensic Audit report, there has been misrepresentation/ falsification of records, diversion of funds and disposal of stocks by the company. The total loss caused to banks was to the tune of ₹824 crore outstanding as on December 31, 2017, the release said.

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