ED arrests Deccan Chronicle promoters Venkatram Reddy and Iyer in money laundering case

Hyderabad: The Enforcement Directorate has arrested Deccan Chronicle Holdings Private Limited (DCHL) promoters, T. Venkatram Reddy and P.K. Iyer on money laundering charges in a bank fraud case.

The ED has also arrested the company's auditor Mani Oommen in the same case.

The trio were reportedly questioned by the agency on Tuesday and were arrested late in the evening for allegedly not cooperating with the investigation. They will be produced before a special Prevention of Money Laundering Act (PMLA) court in Hyderabad on Wednesday.

The ED made the arrests on charges of money laundering in a bank fraud case.

It was in 2013 that a consortium of banks had complained to the Central Bureau of Investigation (CBI) about the nonpayment of loans. The CBI had booked a case based on the complaint.

The CBI had earlier arrested Venkatram Reddy and his brother and another promoter T. Vinayak Ravi Reddy in February 2015 for allegedly defaulting on Rs 357 crore loan taken from Canara Bank. Two months later, he was granted bail.

The alleged total loan fraud of DCHL and its promoters is pegged at Rs 8,180 crore while the original default amount was around Rs 1,500 crore.

The ED had taken up investigation into money laundering allegations based on the case registered by the CBI.

The central agency had provisionally attached assets worth Rs 386 crore belonging to Deccan Chronicle Holdings Limited

The attached assets included 14 properties located in New Delhi, Hyderabad, Chennai, Bangalore, Gurgaon.

Venkatram Reddy, who was earlier promoter of Indian Premier League team Deccan Chargers, had faced allegations with regard to the funds raised by the company to meet its investment requirements, including the IPL team.

The promoters had allegedly manipulated the balance sheets of the company, inflated the profits, advertisement revenue and grossly understated the financial liabilities of the company.