MUMBAI: A special Prevention of Money Laundering Act (PMLA) court has booked 33-year-old Gujarat resident Akram Mohammad Shafi, who was arrested by the Enforcement Directorate (ED) on Wednesday in connection with a money laundering investigation of bank transactions amounting to ₹125 million euros, after seven days of emergency custody.

The ED probe stems from a police probe against a Malegaon-based trader for suspicious transactions through diversion of bank accounts. A case was filed against Siraj Hamed Memon, who operated a tea and cold drinks business, and his associates on November 7 following a complaint by a person whose bank account was allegedly misused for unauthorized fund transfers .

According to the ED, the arrested accused Shafi was allegedly involved in helping Siraj open bank accounts which were used to transfer funds worth Rs. ₹125 crores for shell companies. He was detained from the Ahmedabad airport on Wednesday and remanded to police custody till November 29.

The case came to light after an FIR was registered at the Malegaon police headquarters by a person whose documents were fraudulently used by Siraj and his advisers to set up shell companies. Siraj allegedly opened bank accounts in the name of shell companies at Nashik Merchant Co-operative (NAMCO) Bank in Malegaon.

According to the ED, Siraj allegedly collected the documents from the victim on the pretext of offering a financial benefit or a job. The prosecution claimed that they analyzed 14 accounts at NAMCO bank and found that more than ₹118 million were transferred from these accounts within two months to various entities.

The accused allegedly duped the victims by claiming that he intended to set up a maize trading business at the Agricultural Produce Market Committee, Malegaon, and instructed them to open bank accounts purportedly to transfer money to the farmers, promising them employment with the market committee.

The ED claimed that their investigation revealed that Memon had also opened three accounts with the Bank of Maharashtra in the name of Choice Marketing, Megha Traders and Sunrise Traders, which around ₹41 million were credited within two months, which were later transferred to various other accounts.

Shafi, according to the ED, stayed with Memon at Malegaon for 14 days and helped him arrange documents and open bank accounts in the name of shell companies. A lookout circular was later issued against Shafi, who was detained from the Ahmedabad airport while on his way to Dubai.

The special PMLA court, while allowing the custody of the ED, observed that the prima facie investigation conducted by the agency shows that Shafi was the mastermind behind opening the 14 bank accounts along with Memon. “It shows that 14 accounts were created and a huge amount of cash was deposited,” Special Sessions Judge AC Daga said, adding: “It is the accused who appears prima facie to have arranged the identities of the persons on whose behalf the find the accounts. were opened and was involved in generating the proceeds of crime.”