Sekar Reddy, aides arrested by Enforcement Directorate for money laundering

Sekar Reddy was released on conditional bail a few days ago after the CBI booked a case against him for possessing large amounts of new currency notes, when there were restrictions for withdrawal of new currency following demonetisation.

Enforcement Directorate sources here said that ED had taken up a probe against Reddy and his associates after the CBI had filed a case against them. Earlier, the Income Tax department had seized new currency to the tune of Rs 34 crore from the custody of Reddy and his associates. I-T had also seized 177 kg gold from the custody of the accused. 

ED sources said Sekar Reddy was examined under the provisions of Prevention of Money Laundering Act (PMLA). During interrogation, Reddy had told the ED officials that the cash seized from him by the I-T department belonged to SRS Mining, the firm owned by him and associates, which had won the contract for sand mining across the state. Similarly, Reddy maintained that the new currency notes seized from him were the collection from his mining business and he refused to reveal the real source of the currency. 

However, Sekar Reddy told the investigators that 177 kg gold seized belonged to him and the gold had been purchased through his associate Premkumar. 

During interrogation, Premkumar told ED officials that he had received demonetised currency from Reddy for the purchase of gold bars. He also admitted to the fact that 30 kg of gold seized from his premises belonged to Reddy. 

The third accused Srinivasulu, also told investigators that he used to receive money from SRS Mining for purchase of gold and the remaining amount was kept concealed at various locations. However, he also refused to divulge the details as to how they exchanged the demonetised currency for new notes.