New Delhi, Aug 14 (PTI) Dinesh Gupta, a former managing director (MD) of the country's premium Basmati rice processing company, was recently arrested under the anti-money laundering law in an alleged Rs 1,740 crore worth bank loan fraud case, the Enforcement Directorate (ED) said on Thursday.

Gupta was arrested on August 8.

After completion of the custodial remand of the former MD of Best Foods Limited, a special Prevention of Money Laundering Act (PMLA) court in Delhi sent him to judicial custody till August 27, the federal probe agency said in a statement.

The money laundering case stems from a 2020 FIR filed by the CBI against the company and some others.

The ED said the case pertains to the alleged misappropriation of loans worth Rs 1,740 crore taken from a consortium of banks by Best Food Ltd, one of the largest processors of premium basmati rice in the country.

The ED said Gupta was a "prime accused" in the case as he allegedly manipulated the company's auction process during liquidation, by facilitating the purchase of its properties through more than 75 shell entities registered under his relatives' names.

This, it said, circumvented legal and financial oversight, it alleged.

The agency said it has "uncovered" benami assets worth more than Rs 200 crore which are suspected to have been acquired using "diverted" bank funds.

"ED continues its efforts to trace the trail of illicit funds and identify other individuals involved in the alleged fraud," the statement said.

The agency had conducted searches in this case in July and seized five luxury vehicles, calling them "proceeds of crime". PTI NES KSS KSS

Money laundering probe leads to arrest and custodial proceedings after alleged bank loan misappropriation and benami transfers. Allegations concern misappropriation of consortium bank loans during liquidation of a rice processing company, with the former managing director accused of manipulating auction processes to transfer company properties into numerous related shell entities, evading oversight. The Enforcement Directorate has invoked the Prevention of Money Laundering framework, effected arrest and custodial remand of a principal accused, conducted searches and seizures of assets described as proceeds of crime, and reported uncovering benami assets while continuing asset tracing to identify other persons involved.