Former IL&FS MD and CEO Ramesh Bawa was arrested by the Serious Fraud Investigation Office (SFIO) in connection with an ongoing investigation against Infrastructure Leasing and Financial Services (IL&FS) and its group entities, news agency ANI reported on Saturday.

Bawa’s arrest comes after the Supreme Court’s refusal to extend his protection from being arrested.

On April 1, SFIO had arrested ex chairman Hari Shankaran in the same case for alleged “abuse of power”.

Hari Shankaran had been arrested for “granting loans to non-credit worthy entities, causing losses to the company and its creditors”, a government official had said upon his arrest.

Hari Shankaran was later remanded to SFIO’s custody.

The alleged financial irregularities at the IL&FS group came to light last year after some group companies defaulted on repaying loans.

IL&FS started defaulting in repaying its loans since August last year that made the financial markets panicky and it faced serious credit squeeze. With investors suspecting other NBFCs, their stock prices suffered a hit. IL&FS had a debt of about Rs 91,000 crore and was unable to clear those debts despite having adequate assets, because these assets were not liquid.

First Published: Apr 13, 2019 13:26 IST

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