The government on Saturday arrested the chief plotter and mastermind of Chinese shell companies on Saturday. The man, identified as a Dorste was arrested from Gaya while he was trying to escape India through the land route.
In a press release, the Serious Fraud Investigation Office (SFIO) said that after search and seizure operations conducted by the Ministry of Corporate Affairs on 8th September, the agency had arrested Dorste.
The raids were conducted on the offices of Jillian Consultants India Private Ltd, a wholly owned subsidiary of Jilian Hong Kong Ltd., at Gurgaon, Fininty Pvt Ltd at Bangalore and Husys Consulting Ltd, an erstwhile listed company at Hyderabad.
Dortse was on the Board of Jillian India Ltd and has clearly emerged as the mastermind of the whole racket of incorporating large number of shell companies with Chinese links in India and providing dummy Directors on their Boards, SFIO said. Dortse had shown himself to be a resident of Mandi in Himachal Pradesh as per the records filed with the Registrar of Companies, it added.
Evidence procured during the enquiry by ROC Delhi and the simultaneous search operations clearly points to dummy Directors being paid by Jilian India Ltd. to act as dummies in several shell companies, the release said, adding that boxes filled with company seals and digital signatures of dummy directors have been recovered from the site.
The Indian employees were in touch with the Chinese counterparts through a Chinese instant messaging app. Husys Ltd. was also found to be acting on behalf of Jilian India Ltd, it said.
Initial observations reveal that Husys Ltd. had a pact with Jilian Hong Kong Ltd. Investigations so far have revealed the possible involvement of these shell companies in serious financial crimes detrimental to the financial security of the country, SFIO said.
The Ministry of Corporate Affairs, under whose aegis SFIO operates, had assigned the investigation of Jilian Consultants India Private Limited and 32 other companies to SFIO on 9th September.
Dortse and one Chinese national are the two directors in Jilian Consultants India Private Limited, it said.
Based on inputs and the investigations carried out, it was gathered that Dortse had fled from Delhi NCR to a remote place in the state of Bihar and was attempting to escape India through the road route.
Immediately, a special team was constituted in SFIO which was deputed to the said remote place. In the evening of Saturday, SFIO had arrested Dortse, who was later produced in the Jurisdictional Court and Orders for his transit remand were obtained.
The raids were the impact of News18 investigative series on Chinese loan app scam, involving as many as 1,000 illegal companies operating in India and trapping many needy and innocent in the vicious debt.
The News18 series highlighted how these companies were registered illegally under one address and their company representative was never found on the office premises.
A senior government official had told News18 the corporate affairs’ ministry raided the companies, which included those that helped Chinese open firms in India with fake directors. “It has been found that they used co-working spaces to register their companies. We had also received communication from various law enforcement agencies, after which a massive crackdown has been initiated. Currently, officials initiated action in Bangalore, Hyderabad, and Gurugram,” the government official had said.
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