IL & FS Employee Welfare Trust under the Enforcement Directorate (ED) Lens
The Enforcement Directorate (ED) is investing in the IL & FS Employee Welfare Trust over the possible irregularities, extending its probe into alleged money laundering relating to the subsidiaries of IL & FS. A case under the provisions of the Prevention of Money Laundering Act has been registered against ILF Transportation Networks Ltd, ILFS Rail Ltd, Parthasarathy, and Sankaran.
According to ET reports, the person involved floated shell companies in providing contracts and allegedly transferring Rs 74 crore that was used to purchase the assets. These shell companies were allegedly given a commission of 0.5% of the amount routed to them. In September due to default in IL & FS, it disturbed the markets and engulfed the NBFC sector, which prompts the government to step in and change the force of management. This IL & FS Employee Welfare Trust is the unregistered entity.
These trusts were used to cover the perpetuate of their wrongdoing.