No jurisdiction of ED to register laundering case: Sahara

Sahara group said on Monday the Enforcement Directorate, which has recently registered a fresh money laundering case against it, may not have the ‘jurisdiction’ to do so as capital markets regulator Securities and Exchange Board of India is yet to finish verification of depositors.

"Recently, reports appeared in a section of the media to the effect that proceedings have been initiated against two Sahara companies SIRECL and SHICL under the Prevention of Money Laundering Act, 2002.

“The said statement/report is completely baseless and incorrect.

"Till date, no summons or notice has been received by either of the two Sahara companies for any alleged involvement in any money laundering activity," the company said in an email statement through its lawyer.

A criminal case has been registered against the group by the agency in connection with non-payment of crores of rupees to depositors after it got some fresh reports in this regard from the Sebi.

"The Supreme Court has, by its judgement dated August 31, 2012, directed Sebi to make a verification of the investors, and for this purpose, Sebi has been given detailed step-by-step guidelines, which have to be strictly complied with by Sebi.

"Sebi is yet to carry out this verification. Till this verification is completed by Sebi, and it is ascertained that source of funds collected and the payments made by Sahara companies are not genuine or that the investors do not exist, no allegation of money laundering can be made by anybody or any authority.

“Consequently till then, Enforcement Department or any other authority may not have jurisdiction in the matter, involving verification of investors," the statement said.

Sahara group chief Subrata Roy was jailed in March amid a long-running dispute of his group with Sebi over repayment of over Rs 20,000 crore (Rs 200 billion) to investors.

The group, however, has maintained that it has repaid over 93 per cent of the investors directly.

The ED is now investigating whether these funds were laundered to create illegal assets.

"Sahara companies reiterate their contention that all their investors are genuine and have been already paid back and whose list containing about 30 million accounts have been submitted to Sebi, along with their original application forms, redemption vouchers and other records.

“Now, Sebi has to verify them, to finally put the controversy at end," the statement said.

Image: Sahara chief Subrata Roy