In a major crackdown on financial misconduct, the Enforcement Directorate’s Gurugram Zonal Office has arrested Arvind Kumar, the former Resolution Professional of Richa Industries Limited, in connection with a high-profile bank fraud and money laundering case. Kumar, who served as RP from December 2018 to June 2025, was taken into custody on February 3, 2026, under the Prevention of Money Laundering Act (PMLA), 2002.
Following his arrest, Kumar was produced before a court, which remanded him to eight days of ED custody. This action comes after the earlier arrest of Richa Industries’ former promoter and suspended managing director Sandeep Gupta under the same PMLA provisions. The ED’s probe stems from a CBI FIR alleging criminal conspiracy, cheating, and criminal breach of trust under the Indian Penal Code and Prevention of Corruption Act, which implicated the accused in causing a staggering ₹236 crore loss to public sector banks between 2015 and 2018.
Investigations reveal Kumar abused his position as RP to siphon off company funds for personal gain. During his tenure, substantial sums were layered through shell transactions to entities linked to his associates, employees, and relatives, ultimately looping back into his personal bank accounts. Bank records show over ₹80 lakh in suspicious cash deposits and more than ₹1 crore transferred from related parties—funds that had first been paid out from the company.
ED asserts that Kumar was a direct beneficiary of the ‘proceeds of crime’ from the original bank fraud, disguising these illicit gains as legitimate Corporate Insolvency Resolution Process (CIRP) transactions. This scheme led to public sector banks suffering a 94% haircut, recovering just ₹40 crore against approved claims of ₹708 crore post-liquidation. Notably, the Insolvency and Bankruptcy Board of India had previously suspended Kumar’s RP registration for two years over these irregularities.
The agency emphasizes that such misuse of insolvency processes undermines creditor recoveries, corporate revival efforts, and public trust in the financial system. Further investigations are underway to trace the full money trail and scrutinize all involved parties, signaling ED’s resolve to dismantle such fraudulent networks.