THE Directorate of Enforcement Raipur Zonal Office (EDRPZO), on Thursday arrested Krishna Kumar Shrivastava alias K K Srivastava under Section 19 of the Prevention of Money Laundering Act (PMLA), 2002, in connection with the alleged Rs 15-crore fake Raipur Smart City subcontract fraud. The Special Court (PMLA), Raipur, remanded him to nine days’ ED custody till August 7 for custodial interrogation. According to the ED, Shrivastava allegedly induced M/s Rawat Associates to part with Rs 15 crore by claiming that a Rs 500-crore Raipur Smart City project was available for subcontracting and that the amount was required as performance security. The agency alleged that forged Raipur Smart City documents were produced to lend authenticity to the proposal, while the Smart City office subsequently confirmed that it had never issued any such documents. The ED alleged that the entire Rs 15 crore was diverted into five bank accounts nominated by the accused. Investigation revealed that the account holders claimed the accounts had been fraudulently opened without their knowledge and that none of the five entities existed at their registered addresses. Account details were allegedly transmitted through WhatsApp using a mobile connection obtained in the name of the accused’s office peon. The agency further alleged that 15 to 18 SIM cards had been procured in the employee’s name and used by Shrivastava.

 

According to the ED, the proceeds of crime were layered through a network of shell entities before being remitted to Dubai, Hong Kong, China and Singapore under the guise of freight charges and container leasing. The agency alleged that Rs 3.40 crore was later returned and projected as repayment, though it was itself assembled from tainted layered funds, while Rs 11.60 crore remains unpaid. The ED further alleged that its investigation revealed Shrivastava to be a close associate of former Chief Minister Bhupesh Baghel. The agency claimed he projected himself as an OSD/PA to a senior political functionary and invoked his alleged proximity to politically influential persons and Naxalites-initially to induce the complainant to invest and later to allegedly threaten him with elimination when repayment was sought. The agency also alleged that Shrivastava employed a similar modus operandi against another businessman by obtaining Rs 3 crore in cash along with undated payeeblank cheques, later portraying the transactions as intercorporate borrowings.

 

Indications have emerged that several other persons may have been similarly defrauded, with additional victims currently under examination. Searches conducted in April 2025 resulted in the seizure of handwritten monetary records, a personal diary, property records and electronic devices. The ED alleged that Shrivastava absconded during the predicate investigation, was traced only after a cash-reward proclamation, and admitted to destroying the handset and SIM card allegedly used to communicate with the complainant. The agency further stated that during his statement recorded under Section 50 of the PMLA, he remained evasive, non-cooperative and suppressed material facts. According to the ED, custodial interrogation is aimed at tracing the proceeds of crime, establishing the complete money trail, identifying additional victims and ascertaining the ultimate beneficiaries abroad. Further investigation is under progress.