The Enforcement Directorate (ED) has filed a prosecution complaint against the promoters of three jewelry firms, including former MP Ishwarlal Jain and his son, former MLC Manish Jain, over their involvement in a multi-crore bank fraud case. The complaint was lodged on July 26 with a special court in Nagpur that handles cases under the Prevention of Money Laundering Act (PMLA).
The court has officially recognized the complaint, indicating the commencement of legal proceedings against the accused. The entities implicated include Rajmal Lakhichand Jewelers Pvt Ltd, R L Gold Pvt Ltd, and Manraj Jewelers Pvt Ltd. These firms and their key figuresโboth Ishwarlal Jain, who is also a former treasurer of the undivided Nationalist Congress Party (NCP) and a close associate of NCP (SP) chief Sharad Pawar, and his son Manish Jainโface serious allegations of financial misconduct.
This legal action stems from an ED investigation initiated by three FIRs registered by the Central Bureau of Investigation (CBI). The charges include criminal conspiracy, cheating, forgery, and criminal misconduct. According to the FIR, the accused deliberately defaulted on substantial loans from the State Bank of India (SBI), resulting in a loss of approximately Rs 352.49 crore, in addition to accruing interest.
Investigations have revealed that the promoters engaged in fraudulent activities such as submitting falsified financial documents to secure loans, conducting round-tripping transactions to inflate their financials, and recording bogus sales and purchases. These maneuvers were part of a broader scheme to divert the borrowed funds into real estate investments, often in collusion with company auditors.
Additionally, the promoters allegedly sold off parts of properties mortgaged for these loans without the bank’s approval and destroyed data to obstruct any examination into how the loan money was used.
In a related crackdown last year, ED conducted searches at 13 locations connected to the Rajmal Lakhichand group across Jalgaon, Nashik, and Thane in Maharashtra. These operations resulted in the seizure of gold, silver, and diamond assets worth Rs 24.36 crore and cash amounting to Rs 1.121 crore, along with various incriminating documents.
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Further investigations post-search revealed discrepancies such as fictitious stock inventories and the use of shell companies and dummy directors. In October of the previous year, the ED also provisionally attached movable and immovable assets valued at Rs 315.60 crore, including properties purchased under false names.
