The Enforcement Directorate (ED), Patna Zonal Office, arrested Jawahar Lal Shah under the provisions of the Prevention of Money Laundering Act (PMLA), 2002, in connection with a Ponzi scheme. Shah was presented before the Special PMLA Court in Patna, where he was sent to judicial custody, as confirmed by an official on Wednesday.
The ED’s investigation was triggered by an FIR filed by the Bihar Police under the Indian Penal Code (IPC), 1860, against Mahua JLG Development Cooperative Society Ltd, Jawahar Lal Shah, and other individuals.
During the investigation, the ED uncovered that Shah, in collaboration with his associates, established various companies and cooperative societies, such as Mahua Joint Liability Group Dairy Products and Agro Industries Ltd, Mahua Joint Liability Group Development Cooperative Society Ltd, and Mahua Gavy Prasankaran Swavlambi Sahkari Samiti Limited. These entities fraudulently collected between Rs 25 crore to 100 crore from the public, promising higher returns to investors.
However, these companies failed to pay the promised returns, causing financial loss to the investors, and subsequently shut down their offices. Shah and his associates then laundered the funds by diverting the money to their own accounts, some of which was used to acquire immovable properties.
As part of the investigation, the ED conducted searches under Section 17 of PMLA at five locations across Bihar, West Bengal, Delhi, and Uttar Pradesh on January 7. The searches led to the seizure of incriminating documents, including digital devices.
The investigation into the case is ongoing, with more developments expected as the ED probes further into the money laundering and financial fraud activities linked to Shah and his associates.
