The Enforcement Directorate on Thursday “provisionally attached” assets worth ₹18.5 crore, in the form of mutual funds and shares, belonging to Krishna Damani, former trustee of the South Point Education Society, and his family in connection with an ongoing probe into the alleged siphoning of funds under the guise of providing manpower and other services.
In a release issued on Thursday, the central investigation agency said: “ED investigation revealed that under the guise of availing manpower and other services for SPES, funds to the tune of more than ₹20 crore were diverted to the entities owned and controlled by Shri Krishna Damani and his family members.”
The central agency initiated an investigation based on an FIR registered by Kolkata Police for alleged siphoning of funds of the South Point Education Society, under the provisions of the Prevention of Money Laundering (PMLA) Act.
Sources in the ED said that during the investigation, it was revealed that Damani assumed control over the board of trustees by allegedly sidelining other members.
“Having gained dominance over the governance of M/s SPES, Shri Krishna Damani abused his fiduciary position to divert substantial school funds to entities owned and controlled by himself and his family members, thereby converting charitable funds for personal enrichment and enjoyment. It was revealed that Shri Krishna Damani ensured that payments were supported by fabricated vouchers, fake invoices and fictitious employee records, including salaries paid to non-existent staff and to his personal employees from society/school accounts,” the ED said on Thursday.
“A sizeable portion of the diverted funds was invested in mutual funds and other investments in his own name, in the names of his family members, and in the names of his companies,” a senior ED official said.