Yes Bank money laundering case: ED raids five premises of Cox and Kings in Mumbai

Cox & Kings CFO Anil Khandelwal (left) and Promoter Peter Kerkar. (File photo)

The Enforcement Directorate (ED) on Monday searched at least five offices of bankrupt global travel firm Cox & Kings in connection with its money laundering investigation into the dealings of Yes Bank Ltd former co founder Rana Kapoor.

The teams of the central agency are carrying out the searches under the Prevention of Money Laundering Act (PMLA), officials said.

Cox and Kings, promoted and controlled by Ajay Ajit Peter Kerkar and his family, was sent to bankruptcy court in October 2019, after it defaulted on payments. While the promoter group owns 12.20 per cent shares in the company, the public owns the remaining 87.80 per cent.

The travel and tour company owes Rs 5,500 crore to banks and financial institutions and was one of the top borrowers of Yes Bank Ltd when co-founder Rana Kapoor was heading it.

Yes Bank has an exposure of more than Rs 2,267 crore to Cox & Kings Group. Last month, Ajay Ajit Peter Kerkar was summoned for questioning by the Enforcement Directorate (ED) in connection with the money laundering case against Kapoor.

Kapoor, currently lodged in jail, is accused of taking kickbacks in lieu of granting loans to several companies that have now defaulted on repayments.

In April, The Indian Express, in a series of stories, reported that a forensic audit found the travel company did related party transactions worth Rs 21,000 crore over four years (2015-2019) to siphon off funds. It also found that Cox & Kings had falsified records, booked sales worth Rs 9000 crore to over 160 customers who are bogus or do not exist and inflated bank balances.

While the promoter group owns 12.20 per cent shares in Cox and Kings, the public owns the remaining 87.80 per cent.

Records of the audit, done in February 2020 by of PricewaterhouseCoopers (PWC) at the behest of lender Yes Bank, accessed by The Indian Express, detail how the company allegedly fudged records and window-dressed its figures.

In March 2020, Kerkar was summoned for questioning by ED in connection with the money laundering case against Kapoor.

The investigation has found that Cox and Kings gave Rs 1100 crore to Alok Industries, a stressed firm that went bankrupt in 2017, even as the travel firm did not have any business relationship with the company. Significantly, Chief Financial Officer (CFO) of Cox & Kings Anil Khandelwal is the brother of the CFO of Alok Industries.