The ED on Wednesday conducted raids in Delhi, NCR, and Punjab in connection with a ₹989 crore bank loan fraud by Shilpi Cables Technologies Ltd. Former promoters are accused of securing loans under false pretences, diverting funds abroad through fake Letters of Credit.
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In a high-profile crackdown that underscores the scale of white-collar financial fraud in India, the Enforcement Directorate (ED) on Wednesday conducted extensive raids across Delhi-NCR and Punjab, targeting premises linked to Shilpi Cables Technologies Ltd (SCTL), a company once active in the automobile and telecom cable manufacturing sector.
The action, carried out under the Prevention of Money Laundering Act (PMLA), stems from a 2021 CBI FIR that accused the company’s former promoters of orchestrating a ₹989 crore bank fraud, defrauding a consortium of banks led by IDBI Bank.
Officials revealed that nine premises in the National Capital Region and one in Jalandhar, Punjab, were searched. The case has once again thrown the spotlight on fraudulent corporate financing practices involving fake Letters of Credit (LCs), dummy transactions, and overseas fund diversion.
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According to details emerging from the FIR, loans were secured under the pretence of business expansion, but were ultimately diverted for unauthorised purposes. Once the funds were disbursed, the company defaulted, leading to massive non-performing assets (NPAs) for the banks involved. The ED’s probe is now focusing on tracing the money trail, unearthing the network of intermediaries, and establishing accountability. The role of Manish Goel, the company’s former Managing Director, is under detailed investigation.
SCTL has been under insolvency proceedings since 2017, after defaulting on multiple repayments and failing to produce a viable restructuring plan.
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The case has reignited concerns over corporate governance, due diligence in loan disbursements, and the credibility of internal bank checks, especially when dealing with large loans supported by inflated projections and cross-collateral guarantees.
“This is another reminder that sophisticated financial crime is often disguised in routine business operations,” said a former RBI banking fraud expert. “Unless audits, compliance systems, and credit risk mechanisms are radically upgraded, such frauds will continue to surface post-mortem.”
With the ED now coordinating with international agencies to trace the cross-border flow of illicit funds, the case could also yield insights into foreign exchange law violations, round-tripping of money, and links to shell companies based in tax havens. While no arrests have been made so far, sources indicate that custodial interrogation of key figures is likely as digital and financial evidence is compiled.