New Delhi: The Enforcement Directorate (ED) has unearthed an alleged large-scale money-laundering racket in which Corporate Social Responsibility (CSR) funds were reportedly diverted through a network of charitable trusts and shell entities, involving senior executives of at least 40 public sector undertakings (PSUs), public sector banks, hospitals and private companies.
According to the agency, the alleged racket was operated through multiple trusts associated with Dharmendra Kumar Chandradev, who is accused of impersonating a medical doctor for nearly three decades. The ED has alleged that these trusts were used to receive CSR contributions ostensibly meant for charitable activities, before the funds were allegedly routed through intermediary and shell entities and substantially returned to the original donors in cash.
The investigation reportedly points to a sophisticated mechanism in which CSR contributions were used as a conduit to convert accounted funds into unaccounted cash. The agency estimates that funds worth around ₹200 crore may have been routed through the alleged network.
The ED has alleged that senior executives of several PSUs and public sector banks were bribed to facilitate the release of CSR funds to the trusts linked to the accused. Preliminary findings indicate that at least 40 PSUs and public sector banks across the country allegedly provided CSR donations to trusts operated by the accused. The agency has further alleged that several projects funded through these contributions were either only partially implemented or not executed at all. Investigators have also reportedly found instances where vendor bills were allegedly inflated, with excess funds being routed through bogus or shell entities. Kickbacks and commissions were allegedly paid to intermediaries involved in facilitating CSR funding.
According to the ED’s findings, a significant portion of the funds received as CSR donations was allegedly returned to the contributors in cash after deducting a commission retained by the accused. The agency has alleged that the mechanism allowed legitimate CSR allocations to be diverted from their intended social purposes while simultaneously creating a channel for the conversion of accounted money into unaccounted cash.
The ED reportedly conducted searches on October 1 at eight locations across Maharashtra, Bengal, Gujarat and Delhi-NCR in connection with the alleged bogus donation cases. During the searches, the agency seized documents and other evidence relating to transactions involving PSU executives and corporate hospitals. Approximately ₹21 lakh in unaccounted cash was also reportedly recovered. The investigation further suggests that some of the charitable trusts were projected as vehicles for procuring high-end medical machinery and equipment for hospitals and healthcare institutions, raising questions over the actual utilisation of the CSR funds received.
The case has brought renewed attention to CSR governance, due diligence, fund utilisation, implementing-agency oversight and financial transparency. If the allegations are established, the investigation could have wider implications for how CSR contributions are monitored and accounted for across the corporate and public-sector ecosystem.