The Karnataka Criminal Investigation Department (CID) arrested Saturday Sushil Mantri, the director of Mantri Developers, in connection with a money laundering case in which his firm is accused of cheating home buyers. Sources in the CID said that Mantri was handed over in judicial custody till September 12.
Mantri was accused by buyers that he had swindled their money and FIRs were registered in Bengaluru. The Enforcement Directorate (ED), which had initiated a probe in March this year, arrested him in June but he got bail later.
As the news of Sushil Mantri’s arrest broke, home buyers came to the CID office to share documents demanding justice. The police sent them back stating that they would be probing the matter.
According to the ED, many home buyers filed a complaint stating that they were cheated by falsification of information about delivery timelines and the company collected more than Rs 1,000 crore as advance money from them. They have not been given possession of their flats even after passing of seven to 10 years, they alleged.
During the investigation, it was also noticed that the company offered various Ponzi-like schemes which were named “buyback plans” and advance money was collected for the flats/houses. In some cases, the company did not refund the amount to the buyers even after a clear direction from the Real Estate Regulatory Authority (RERA).
The ED investigation revealed that the money collected from the buyers was diverted for personal use by the management of the company or for other fraudulent purposes and hence the projects were stalled.
Currently, the group has outstanding loans of around Rs 5,000 crore from various financial institutions, out of which about Rs 1,000 crore is overdue, while some of the loans has been termed as non-performing asset (NPA). It was also revealed that the company cross-collateralised its assets to different financial institutions for taking multiple loans on the same assets.
