The Enforcement Directorate has arrested two Axis Bank managers in New Delhi and seized 3 kg gold bars in connection with its money laundering probe in a racket of illegally converting old notes in connivance with banking authorities.
The agency's probe till now, after it registered a criminal complaint under the Prevention of Money Laundering Act on November 30, found that huge monies were transferred through RTGS transfers to some shell companies including a case where the director of such a firm was a "petty labourer."
"It was also found that directors of other shell companies were also persons of no means," the ED said in a statement.
The agency identified the two managers as Shobit Sinha and Vineet Gupta, working at Axis Bank's Kashmere Gate branch in the national capital, and said they were arrested late on Sunday under the provisions of PMLA. This is the first time such high ranking bank officials have been arrested for alleged fraud transactions post the currency scrap.
They will be produced in a court for further custody, they added.
Axis Bank said it has suspended the officials concerned.
"The bank is committed to following the highest standards of corporate governance and has zero tolerance towards any deviation on the part of any of its employees from the set model code of conduct. In this particular case, the bank has suspended the erring employee and is cooperating with the investigating agencies," it said in a statement.
A gold bar, part of alleged kickbacks payment given to the bankers, has been seized by the agency from Sinha's location in Lucknow, ED said, adding another 2 kg of gold bars have also been seized from one of the jewellers involved in the racket.
The case was first detected by the Delhi Police after it intercepted three people with cash of about Rs 3.7 crore in old notes, in front of the said Axis Bank branch last month, and the ED took cognizance of the police FIR to slap money laundering charges against the accused.
The Income Tax department too had carried out its action in this case and had surveyed the bank branch and later searched the residential premises of the duo.
ED has notified the bank to "stop operations" in 11 accounts even as it has zeroed on a number of jewellers, entry operators and others in this case.