Rohini Singh, ET Bureau May 7, 2012, 12.51AM IST
NEW DELHI: Defence minister AK Antony has asked investigation agencies to probe into charges levelled against Delhi-based businessman Abhishek Verma, by his former partner, accusing him of acting as a middleman in several defence deals and parking over $205 million in accounts in a bank in the US.
“I have asked the CBI and the Enforcement Directorate to investigate the allegations. The defence secretary has also been asked to take necessary action,” Antony said.
These allegations have been made by C Edmond Allen, head of a New York-based company called Ganton Limited, in a series of letters to Antony. His charges cover purported dealings between Ganton, which Allen – a non-practising attorney – said was incorporated in the US state of Delaware on Verma’s instructions, and major equipment suppliers to the Indian armed forces such as Rheinmettal, Augusta Westland, Hellenic Defence Systems and Hawker Beechcraft.
A top CBI official said the investigations were at a preliminary stage. “We are in touch with Allen and have asked him to submit the documents in original,” said the official. He also said the agency is coordinating with the Enforcement Directorate as there were allegations of large scale money laundering.
Verma, the son of former Congress leader Srikant Verma, is an accused in the naval war room leak case where several sensitive defence documents were stolen and allegedly leaked to Thales, the maker of Scorpene submarines.
He has denied all charges levelled against him by Allen, and said documents implicating him have been forged. Verma said he had received a notice from the Enforcement Directorate asking for an explanation for the money in the accounts but was unable to comment since the matter was sub judice.
“As several petitions filed by me against C Edmonds Allen are pending in various Indian and foreign courts and these cases are somehow connected to alleged foreign exchange violations in which trial is going on in India under FERA Act for ten years, it will not be possible for me to comment as matters are sub-judice,” he wrote.
According to Allen, the escrow accounts belong to Verma but he had the right to handle them as a result of agreements signed between the two in April 2000 and February 2004. Allen has alleged that the money in these accounts has been obtained through illegal means and that Verma has acted as a middleman in several defence deals. Verma, in turn, has issued legal notices to Allen to return the money and a case has been filed in a district court in New York, according to documents reviewed by ET.
Verma, the son of former senior Congress leader Srikant Verma and MP Veena Verma has business links with Jagdish Tytler, a Congress Working Committee member and the party’s Odisha in-charge. Tytler’s fashion designer son, Siddharth, is a founder shareholder in a company along with a former director of Ganton, Arjun Arora. Siddharth Tytler had also signed a joint venture agreement with Ganton India.
Confirming this Jagdish Tytler also told ET that he knew Verma as his parents were colleagues of his. He denied any knowledge of defence deals that Verma is alleged to be involved in.
Tytler also confirmed being an arbitrator in a dispute involving Ganton and another company over nearly hundred acre of land in Noida which belongs to the Yamuna Express Industrial Development Authority.
People close to Verma say that the allegations levelled against him were at Tytler’s behest, a charge that has been strongly denied by both Tytler and Allen. Allen, however, told ET in an email that Tytler and Verma were very close but had fallen out recently over the Noida land deal.
Allen has also alleged that Verma has often flaunted his links with several powerful politicians which has supposedly ensured that no enquiry is initiated against him. Allen also claims to posses several sensitive defence documents allegedly emailed to him by Verma which show his ‘easy access within the government’.
The letters to Antony paint a picture of labyrinthine corruption in defence deals with Verma allegedly at the centre. Some of the documents linked to the case, were publicly released by India Against Corruption (IAC) in late April, a group linked to activist Anna Hazare, after Allen sent the documents to lawyer Prashant Bhushan. In a blog posting in New York Times dated April 27, Allen was quoted as saying that he had approached it after Indian authorities showed no interest in his allegations.
In a letter to Antony dated March 28, 2012, Allen alleged that German firm, Rheinmetall AG, paid Ganton $530,000 to reverse its blacklisting by India’s defence ministry. The money was supposedly paid through the firm’s UBS account in Switzerland, according to bank statements of Ganton Limited, and an invoice generated by the company.
Emails sent by ET to Rheinmetall officials did not elicit a response.