The Enforcement Directorate (ED) has arrested Manoj Gaur, Managing Director of Jaypee Infratech Ltd. (JIL) and a prominent builder from Greater Noida, in connection with an alleged ₹12,000-crore money laundering and homebuyer fraud case.
According to officials, the arrest stems from a long-standing investigation into financial irregularities involving Jaypee Infratech Ltd., Jaiprakash Associates Ltd. (JAL), and their promoters, accused of diverting funds collected from homebuyers and investors under the pretext of constructing residential projects.
15 Locations Searched; Cash and Digital Evidence Seized
Earlier in May, ED officials conducted raids at 15 locations linked to JIL, JAL, and their associated entities across Delhi, Noida, Ghaziabad, and Mumbai, under the Prevention of Money Laundering Act (PMLA), 2002.
During the searches, the agency seized over ₹1.7 crore in cash, along with financial documents, property records, and digital data belonging to the promoters and their family members. The investigation also extended to business associates, including Gaursons India Pvt., Gulshan Homz Pvt., and Mahagun Real Estate Pvt. Ltd.
The Scam: Funds Collected, Homes Undelivered
The probe centers around the Jaypee Wish Town and Jaypee Greens projects, where thousands of flats were sold between 2010 and 2011 but never delivered.
Multiple FIRs were registered in 2017 by the Economic Offences Wings (EOW) of Delhi and Uttar Pradesh Police after large-scale protests by defrauded homebuyers.
Investigators allege that project funds were diverted to other Jaypee Group ventures, including cement, power, and hospitality businesses — a violation of RERA norms and loan conditions set by financial institutions.
“Funds meant for housing projects were systematically siphoned off, leaving thousands of homebuyers stranded,” a source familiar with the investigation stated.
ED and EOW Build Joint Case Under IPC and PMLA
The ED’s case builds upon earlier FIRs filed under multiple sections of the Indian Penal Code (IPC), 1860, including cheating, criminal conspiracy, and dishonest inducement.
The agencies allege that the Jaypee Group raised large sums through homebuyer advances, IPOs, and loans, but instead of completing the promised apartments, the money was laundered through complex corporate layers.
Jaiprakash Associates, the flagship entity of the Jaypee Group, operates in sectors like cement, construction, and power, and is now facing multiple insolvency and recovery proceedings from both homebuyers and banks.
A Crisis That Shook India’s Realty Sector
The Jaypee Wish Town crisis became one of India’s most significant real estate scandals, affecting thousands of middle-class families who invested their savings in the hope of owning a home in the NCR region.
Industry experts see the arrest as a major step toward accountability in India’s troubled housing sector, where developer insolvency and fund diversion have left millions of buyers in limbo.
