The Enforcement Directorate (ED) carried out raids at 11 places in Mumbai concerning its probe into the alleged money laundering, which is related to the Covid centres scam, which is estimated to be around Rs 600 crore. In this alleged scam, irregularities were reported while awarding the contracts for running Covid centres in the city by the Brihanmumbai Municipal Corporation’s (BMC). These 11 locations belonged to the suppliers and contractors who were part of this scam.
As per the reports, an ED source states, “We are verifying if a substantial percentage of the profits earned in certain inflated Covid contracts were shared with BMC officials, middlemen and others claiming to have political influence”.
The ED source added, “A lot of irregularities were noticed during the searches on Wednesday (July 5) and they are being probed further to reach the end-beneficiaries of the proceeds from the profits gained in inflated contracts”.
On July 5, the agency confiscated Rs 1.2 crore in cash from the premises of a civic contractor connected to a construction company. The agency also made a recovery of Rs 60 lakh from the premises of another contractor, Romell Realtors.
As per the ED source, “While the agency’s officials had interrogated all the contractors during the search operations, it will record their statements at its office once they are summoned for questioning during the next two weeks”.
According to ED sources, one of the contractors under investigation who is connected to the construction company accepted a contract to install oxygen units at Jumbo Covid clinics and is accused of billing the BMC Rs 60 crore more than what it spent on expenditures. The accused billed the BMC oxygen cylinders five times the market rate during the pandemic.
The ED source stated, “The contractor procured the oxygen from another Delhi-based supplier for Rs 20 crore but the BMC had to pay Rs 80 crore for the same. We are verifying how and why he charged in excess and where the profits went”. The source added, “The same contractor had also charged the BMC Rs 60 crore in another similar contract, though it is suspected that he may have spent only Rs 12 crore”.
On the other hand, Romell Realtors had agreed to help with the construction of a 2,000-bed Jumbo Covid facility in Goregaon beginning in June 2020. The firm informed the ED that they had provided materials such as air conditioners, fans, and chairs as part of a deal that was estimated to be worth approximately Rs 11.36 crore, plus taxes.
The ED source stated, “The firm has denied any wrongdoing and claimed that after implementing its contract, they donated the remaining articles worth Rs 2 crore, as a CSR measure to the BMC. The details of the contract are being verified”.
Another contractor, an events management company, is also under investigation by ED. This company had provided beds and other items for two Covid centres and was paid around Rs 88 crore, as per the reports.
According to the ED source, the company had previously worked on a similar project before winning the civic contract, adding, “We are verifying if there were any irregularities in the contract. The agency could not check the content of the contractor ‘s phone as he claimed to have lost it in a cab recently”.
The ED is also investigating an Aurangabad-based contractor for allegedly selling body bags for exorbitant prices.
Last month, on June 21, the Enforcement Directorate (ED) carried out raids at 15 places in Mumbai and adjoining areas concerning its probe into the Covid centres scam. The agency conducted searches at the premises of businessman Sujit Patkar who is a family friend of Shiv Sena (UBT) MP Sanjay Raut.
The agency also conducted raids at several locations related to officials of the BMC and at other individuals which included IAS officer Sanjeev Jaiswal in connection with the irregularities while awarding healthcare contracts during the Covid-19 pandemic. Jaiswal was the former additional municipal commissioner of BMC.
In this regard, ED officials also raided the Chembur residence of Suraj Chavan, the personal assistant of Aaditya Thackeray, the son of Shiv Sena (UBT) chief Uddhav Thackeray. Per the officials involved in the case, Patkar and his three associates fraudulently got Mumbai civic body contracts during the pandemic to manage Covid-19 field hospitals.