ED searches DHFL offices over exposure to firm having links with gangster Mirchi

MUMBAI: The Enforcement Directorate (ED) Saturday carried out searches at the offices of Dewan Housing Finance Corporation Ltd (DHFL) and it associate firms in connection with the loans given by the NBFC to a real estate firm which is currently under scanner for its alleged dealing with late gangster Iqbal Memon alias Iqbal Mirchi.
According to sources, searches are underway at eight locations including DHFL’s headquarters in suburban Mumbai.

ET was the first to report on the loans given by DHFL to Sunblink Real Estate on Thursday. Responding to the report, DHFL in a statement attributed the quantum of its exposure to property company Sunblink, as an outcome of market consolidation that caused several loans to various companies to be bunched together and Sunblink listed as the borrower.

“DHFL had funded certain projects of various companies,” the home financier said in a filing with the stock exchanges. “Due to market conditions, the borrowers had streamlined their internal operations whereby they have, by certain corporate actions undertaken recently, merged certain of their companies into Sunblink. As a result, as on date, Sunblink is mentioned as a borrower

DHFL has emerged as the mysterious lender that gave loans worth Rs. 2,186 crore to Sunblink Real Estate. Investigations by ED have revealed that a non-banking financial company had started giving loans to Sunblink beginning 2010. The ED believes this money Rs. 2,186 crore — was allegedly routed overseas by Sunblink into the accounts of Iqbal Memon, also known as Iqbal Mirchi.

The ED has not named DHFL as the NBFC in question, but Sunblink’s accounts for 2010 clearly indicate that it had received Rs. 22 crore as loans from the troubled Mumbai-based financial services firm during the year.

Over a period of nine years, the total loan amount totals Rs.2,186 crore, as per documents reviewed by ET.

These documents show financial ties between Sunblink and DHFL. In July this year, DHFL had approved consolidation of loans to Sunblink, “along with security perfection amounting to Rs.2,186 crore”.

In its remand plea for Ranjeet Bindra, a go-between for Mirchi and Sunblink, the ED said Tuesday that “an NBFC” had given money to the realty company.

These funds were used by Mirchi to finance terror and purchase property in the Middle East, the ED claimed. The amount of Rs 2,186 crore, according to the agency, was “laundered” and “subsequently used for terror financing”.

DHFL had sent the six-page document on loan consolidation to Sunblink’s BKC offices on July 24. In the document, DHFL has sought security of Sunblink’s Worli property and hypothecation of receivables from houses sold in the developed property. The loan will carry an annual interest of 10% with monthly resets.

Other terms and conditions include classification of DHFL as the preferred finance partner with the first right to consider housing loans for individual homebuyers. The document also demands that Sunblink should commit to operate the project under all rules of the Real Estate (Regulation and Development) Act, 2016.

The revelations follow the arrest of Mirchi’s close aides — former chairman of Sir Mohamed Yusuf Trust, Haroun Yusuf, and real estate broker Bindra. The ED had arrested the duo on Friday.

Officials also said the identity of ‘Dheeraj Deewan’ of Sunblink Real Estate — at whose behest Bindra allegedly brokered deals with Iqbal Mirchi — is not yet clear.

DHFL’s financial troubles caused a market crash in October last year and sparked off a crisis in the NBFC sector. Some of the country’s biggest lenders — including State Bank of India — are putting together a rescue package for the firm. But the planned rescue could be in jeopardy if the ED probe reaches DHFL.

The ED is also probing real estate transactions between Sunblink, Iqbal Mirchi, Sir Mohamed Yusuf Trust and Millennium Developers — which is owned by Nationalist Congress Party leader and former union minister Praful Patel. He was questioned at the agency’s Ballard Pier office on Friday for over 10 hours.

The probe agency claims that Bindra brokered a deal between Mirchi and Sunblink to develop three buildings in Worli that originally belonged to Sir Mohammad Yusuf Trust but were illegally taken over by Mirchi. These plots are referred to as “proceeds of crime of Mirchi under probe”.

“This is a sensitive case involving huge amount of proceeds of crime apparently generated from the organised crime sector and its subsequent laundering/use for terror financing,” said the ED remand application.

Filing a remand application earlier in the case, the agency had said that in 2010 a payment of Rs 4.25 crore was made to Sir Mohamed Yusuf Trust and Rs 175 crore to Iqbal Mirchi’s aide Humayun Merchant, for the tenants represented by him. As per Sunblink’s balance sheet of 2010, Rs 5 crore was paid to Merchant as “advance for land”.

Merchant is a key witness for the ED. Officials of the probe agency said Merchant — in his statement to the ED — has revealed that the money paid by Sunblink was diverted to Mirchi through hawala channels. These funds were used by Mirchi to buy a five-star hotel in Dubai, according to the documents filed by ED.