MUMBAI: The Enforcement Directorate (ED) on Friday carried out searches in six cities including Mumbai and Nashik as part of its money laundering investigation linked to the alleged manipulation of share prices of two listed companies, which led to more than 100,000 small investors losing ₹ 600 crore, the suspected proceeds of crime in the case.
The ED’s probe is based on two police cases. Separately, the alleged manipulations in share prices are under the scanner of the Securities and Exchange Board of India (SEBI) which had carried out searches a few months ago.
The ED’s investigation has found that between April 2023 and March 2024, the two companies allegedly issued over 3.5 crore shares and convertible warrants (the right to purchase a company’s shares at a fixed future price) to select persons and entities.
During the search, various allegedly incriminating documents, digital devices, records of share transactions and property documents were found and seized, according to the ED officials. The ED is probing the role of a market manipulator, who was earlier under the agency’s scanner in a separate investigation related to illegal/unethical trading, officials said. A large chunk of the payment for these shares was allegedly sourced from a small circle of connected persons, firms and lenders, after which share prices were allegedly “steadily pushed up” over months.
