Hari Sankaran, former chairman and managing director of crisis-hit Infrastructure Leasing and Financial Services (IL&FS), has been arrested for alleged fraud, abuse of power and causing wrongful loss to the troubled infrastructure lender.
“The Serious Fraud Investigation Office on Monday arrested Hari Sankaran in connection with the ongoing investigations into the affairs of IL&FS and its group entities,” official sources said.
Sankaran has been remanded in custody till April 4, they said.
He is the first person to be arrested by the Serious Fraud Investigation Office (SFIO) in the IL&FS case.
Sankaran is accused of abusing his powers in IL&FS Financial Services through fraudulent conduct and in granting loans to entities that were not credit-worthy or were declared as non-performing accounts. His action caused wrongful loss to the company and its creditors, sources said.
The lender had borrowings of more than Rs 17,000 crore from debt instruments and bank loans.
Provident funds, pension funds, gratuity funds, mutual funds, public and private sector banks are among those who have invested in these debt instruments.
