Illegal gratuity paid to the top Yes Bank employees through the prism: ED in court

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The Directorate of Enforcement (ED) has informed a local court that senior employees of, including its former co-founder and MD Rana Kapoor, are under scanner for receiving an alleged illegal gratuity for authorizing a loan to the group Avantha by Gautam Thapar.

The federal agency said so in its indictment indicting Rana Kapoor, Gautam Thapar and 19 other people and entities. A local court learned of ED’s indictment on Saturday and summoned all the defendants.

The indictment, reviewed by ET, states that “Gautam Thapar and Rana Kapoor play a pivotal role in the generation of proceeds of crime, as they knew from the start that the loan was taken on fictitious agreements that were not never supposed to be executed.The duo also knew that the thus generated proceeds of crime had to be channeled from one company in the group to another until they reached the existing lenders, namely Edelweiss and Aditya Birla Group to repay existing loans from APIL and AHL (Avantha group companies) ”.

He adds “It has also happened during an investigation under the Prevention of Money Laundering Act (PMLA) of other senior Yes Bank employees that high salaries and benefits (proportionately very high compared to at the same positions in other banks) were paid to senior Yes Bank employees to quickly evade the responsibilities of their delegation and authority and in return, Rana Kapoor was rewarding them with huge salaries and benefits using the Yes Bank public money. “.

Giving further problems to Rana Kapoor, the agency’s indictment read: “Further, there is no need and no human probability of granting such unlawful favors unless Rana Kapoor does also gets an illegal gratuity in return and the same is still under investigation ”.

The ED alleged that “Yes Bank’s exposure in the Avantha group was huge and risky and Yes Bank was well aware that additional exposure might not lead to any clawback. Yet the loan was granted to OBPL (a company linked to the Thapar group) which was and should remain a non-income generating company and therefore unable to service the loan “.

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