ED Raids PGC Corporation in ₹116.79 Crore Bank Fraud Case, Seizes ₹82 Lakh Cash
The Enforcement Directorate (ED), Chennai Zonal Office-II, conducted search operations at six residential and office premises across Tiruppur and Chennai on September 18, 2026, as part of a money-laundering investigation linked to an alleged bank fraud involving M/s PGC Corporation Ltd. and others.
The searches were carried out under the provisions of the Prevention of Money Laundering Act (PMLA), 2002. The case stems from an FIR registered by the Central Bureau of Investigation’s Economic Offences Branch (CBI EOB), Chennai, over an alleged fraud of approximately ₹116.79 crore involving Indian Overseas Bank (IOB).
The case names PGC Corporation Ltd. and its directors, D. Prem, Aadith D. Vikram and K. Kaleeswaran, along with unidentified public servants and private individuals.
According to the ED, PGC Corporation had obtained loan facilities from Indian Overseas Bank. The account was classified as a non-performing asset (NPA) in 2013 and subsequently declared fraudulent by the bank in 2020.
The agency’s investigation allegedly found that the company submitted falsified and manipulated financial statements for the 2011–12 financial year to secure enhanced credit facilities. The loan funds were then allegedly diverted to personal bank accounts, foreign entities and transactions involving the circulation of funds back into India.
The ED further alleged that D. Prem and Aadith D. Vikram established a network of domestic and overseas companies and firms through which the borrowed funds were diverted under the guise of investments.
According to the agency, substantial amounts transferred abroad as investments were subsequently routed back into India and used to meet local business expenses. This alleged process of moving funds out of the country and bringing them back is commonly referred to as round-tripping.
The investigation also revealed, according to the ED, that PGC Corporation’s inventory, valued at more than ₹235 crore, was sold to related entities without the actual receipt of sale proceeds after the bank initiated loan recovery proceedings. The agency further alleged that these related entities were later allowed to close without obtaining the lenders’ approval.
During the searches, investigators reportedly found that D. Prem and Aadith D. Vikram maintained a lavish lifestyle, with properties and other assets held in the names of their spouses and relatives.
The ED also alleged that the two had established new businesses in the names of family members and employees while continuing to manage and control their operations.
The search operations resulted in the seizure of approximately ₹82 lakh in unexplained cash, two luxury vehicles, laptops, pen drives, mobile phones, property documents and other material described by the agency as incriminating.
The ED’s investigation is continuing to trace the alleged diversion of loan funds, identify the beneficiaries and examine the movement of money through domestic and overseas entities.
News Source : Information for this article was gathered from a variety of reliable news outlets.
