The Directorate of Enforcement (ED) carried out search operations at multiple locations in Mumbai on September 11 and 12, 2023, as part of a money laundering investigation into M/s Max Flex Imaging and System Ltd. The company is managed and controlled by Hitesh R. Jobalia and Nimesh N. Shah. The operation resulted in the seizure of assets, including stocks of Flex, Vinyl, and other items valued at Rs. 12 Crore, Fixed Deposit Receipts (FDRs) amounting to Rs. 1.25 Crore, Demat accounts with a balance of Rs. 6.30 Crore, foreign currency, cash, gold jewelry, and silver bars, totaling Rs. 20.11 Crore.
The ED initiated its investigation based on an FIR filed by the BS & FB CBI, Mumbai, under various sections of the Indian Penal Code and the Prevention of Corruption Act. The FIR alleged a wrongful loss of Rs. 464.41 Crore to the Consortium group of State Bank of India (SBI), which served as the lead bank, along with eight other consortium member banks.
The ED’s investigation unveiled a criminal conspiracy involving M/s. Max Flex & Imaging Systems Ltd. and other accused individuals who cheated the Consortium group of banks, including the lead bank, State Bank of India, and eight other members. This was accomplished by fraudulently obtaining loans through the submission of inflated stock statements and balance sheets for the said company. The promoters of the company diverted and misappropriated the funds received from the banks, using them to purchase various properties and channeling the funds to various firms and companies incorporated in the names of employees, ex-employees, relatives of the company, and its directors.
The ED’s actions underscore its commitment to combating financial irregularities and money laundering activities. The seizure of significant assets is a significant development in the ongoing investigation, reinforcing the authorities’ determination to bring the guilty parties to justice.
