India's Financial Crime Crackdown: Multi-Agency Investigation Exposes ₹7,000 Crore Fraud Network

A series of coordinated enforcement actions across India has uncovered a sprawling web of financial crimes spanning bank fraud, illicit liquor trade, and cross-border money laundering networks. The investigations, conducted by the Enforcement Directorate (ED), Central Bureau of Investigation (CBI), and Income Tax authorities, have collectively exposed schemes involving over ₹7,000 crore (approximately $84 million) and implicated senior corporate executives, government officials, and political figures.

The crackdown represents one of India's most significant multi-agency efforts against financial crime, revealing sophisticated mechanisms for moving illicit funds through shell companies, benami property transactions, and international money laundering channels. The cases highlight systemic vulnerabilities in India's financial oversight framework despite strengthened regulatory measures in recent years.

Background and Context

The enforcement actions follow years of increasing scrutiny of India's financial crime landscape, where investigators have documented the evolution from simple fraud to complex, multi-jurisdictional money laundering operations. According to financial crime analysts, these cases demonstrate how perpetrators exploit regulatory gaps between different enforcement agencies and jurisdictional boundaries to conceal illicit activities.

The cases emerged from separate investigations that later revealed interconnected networks. The ED's operations against corporate fraud and money laundering have intensified since 2020, with the agency reporting a 45% increase in asset seizures and attachments. Meanwhile, the CBI's anti-corruption unit has maintained pressure on government officials, registering over 1,200 cases in the past year alone involving bribery and abuse of office.

Key Figures and Entities

Among the most significant cases is the ₹1,400 crore bank fraud involving S. Kumars Nationwide Ltd (SKNL), where investigators allege that former CMD Nitin Kasliwal orchestrated a scheme involving fake invoices and fabricated documents to secure bank loans. The ED recently seized Kasliwal's ₹150 crore London property, marking one of India's successful cross-border asset recovery actions. Corporate records show the property was held through offshore entities designed to conceal beneficial ownership.

In the Chhattisgarh liquor scam, the ED has named 81 accused individuals, including senior bureaucrats and political figures, in what investigators describe as a "parallel excise system" that allegedly diverted government revenues through fake license schemes and illicit distribution networks. According to agency statements, the operation generated an estimated ₹2,883 crore in illicit proceeds over five years.

The investigation has also ensnared Apollo Green Energy, an IPO-bound company that ED documents link to a sophisticated money laundering network operated by UAE-based fugitives. Search operations conducted in Delhi, Gurugram, and Rohtak revealed financial trails connecting legitimate business operations to illicit fund movement through multiple shell entities.

Legal and Financial Mechanisms

The cases demonstrate the sophisticated financial mechanisms employed by perpetrators to conceal and move illicit funds. In the SKNL case, investigators documented the use of layering techniques involving multiple corporate entities and offshore jurisdictions to obscure the origin of funds. The seizure of the London property was executed through mutual legal assistance treaties, highlighting the challenges of cross-border enforcement.

The Chhattisgarh liquor scam allegedly operated through a complex network of shell companies and benami transactions designed to circumvent excise regulations. According to ED chargesheets, the scheme involved fake manufacturing units, forged transportation documents, and manipulated distribution channels that created the appearance of legitimate business operations while diverting government revenues.

In the Hyderabad land case, the Income Tax department's benami prohibition unit attached 282 acres valued at ₹2,002 crore, allegedly purchased through front companies to conceal the involvement of former Sanghi promoters. The investigation revealed how agricultural land regulations were exploited through forged documents and fake ownership structures to facilitate massive land deals without proper regulatory oversight.

The CBI's arrest of a CGST superintendent accepting a ₹5 lakh bribe in Mumbai highlights the continuing challenge of corruption within tax administration itself. According to the agency's case files, the official demanded payment to resolve tax disputes, demonstrating how systemic corruption can undermine enforcement efforts.

International Implications and Policy Response

The cross-border dimensions of these cases underscore the limitations of domestic enforcement in an increasingly globalized financial system. The successful seizure of assets in London and the UAE connections in the Apollo Green Energy case demonstrate both the reach of Indian financial crime networks and the importance of international cooperation in enforcement efforts.

Financial crime experts note that these cases reveal critical gaps in India's anti-money laundering framework, particularly regarding beneficial ownership transparency and cross-border information sharing. The Reserve Bank of India has since issued enhanced guidelines for banks regarding due diligence and transaction monitoring, while the Ministry of Corporate Affairs has proposed stricter requirements for offshore holdings.

Parliament's Standing Committee on Finance is currently reviewing recommendations for strengthening the Prevention of Money Laundering Act, including provisions for greater inter-agency coordination and enhanced penalties for corporate fraud. The committee's interim report emphasizes the need for technological solutions to track financial transactions across multiple jurisdictions in real-time.

Sources

This report draws on official statements from the Enforcement Directorate, case filings from the Central Bureau of Investigation, and orders from the Income Tax Department. Additional information was obtained from Moneylife reporting on financial crime enforcement actions between December 2024 and December 2025, corporate registry filings, and court documents from relevant proceedings. The investigation also incorporates analysis from financial crime research institutions and regulatory transparency reports.