New Delhi: The Uttar Pradesh government has scrapped a multi-crore Memorandum of Understanding (MoU) it had signed with VueNow Infotech Pvt Ltd after the company’s founder was arrested by the Enforcement Directorate (ED) for alleged money laundering activities, ThePrint has learnt.
With the ED discovering that VueNow had “no real business”, the firm has also been blacklisted by the state, it is learnt.
The MoU was related to setting up of data centres in state districts at an investment of Rs 13,500 crore.
The ED had sent a written communication to the UP government sharing details of its investigation, causing embarrassment to the state which had promoted the signing of the MoU in 2022 with VueNow, founded by Sukhvinder Singh Kharour.
The signing had taken place in the presence of then chief secretary D.S. Mishra, with the government claiming that UP was “fast becoming a preferred destination for data centre operators”. The government had also partnered with the company to facilitate statewide development.
At the time, Kharour had stated that his company was “committed to establishing 750 data centres covering all 75 districts of the state”, adding that a pilot data centre had already been launched in Ghaziabad’s Morta.
During the UP Global Investors Summit 2023, Kharour was also seen speaking in the presence of several senior state government officials, expressing confidence in UP’s policies.
Speaking to ThePrint, a senior government official said: “The agreement with VueNow stands cancelled and the company has been blacklisted. We received a written communication from the ED on the credentials of Sukhvinder Singh Kharour and his company, which the agency claimed is involved in money laundering.”
The officer said the government had received no funds from the company.
“It (the deal) was still at a very early stage. This was just an MoU, which is non-obligatory. This was a very preliminary stage. This now stands cancelled,” the officer added. He also said that credentials of the investor are checked before any transaction happens.
The case
It was in November 2022 that Kharour, chief executive officer and founder of VueNow Group, had bagged the hefty deal with UP for group company VueNow Infotech Pvt Ltd (VIPL).
The ED, however, arrested Kharour and his wife Dimple from Indira Gandhi International Airport in New Delhi on 28 February as “they were trying to fly out of India to escape”. Sources in the ED said they are being investigated for an alleged ponzi scheme and money laundering activities.
The duo was arrested under provisions of the Prevention of Money Laundering Act, 2002, in connection with a money laundering investigation against VIPL’s sister concern VueNow Marketing Services Ltd (VMSL) and related entities and persons, the ED said in a statement.
A tip-off was received last year about VIPL and its sister concerns allegedly violating provisions of the Foreign Exchange Management Act, following which the ED started its probe.
During investigation, the agency claimed to have found that promoters and directors of these firms were running a scheme in which they lured people into investing in cloud particles or servers, for which they offered guaranteed rental returns of 48 percent per annum.
“These promoters and directors told the investors they would rent out these cloud particles to clients, and the rental income would go to them (the investors). The only thing was that there were no clients,” an ED source said.
Instead, new investors were brought in to pay the old investors, using the bank accounts of sister firms Zebyte Rental Planet Pvt Ltd (ZRPPL) and Zebyte Infotech Pvt Ltd (ZIPL).
ThePrint earlier reported that while the PMLA probe does not stem from a complaint by an investor, the ED has claimed to have established that money passed on as rent from clients to investors was actually got from new investors and no real rental income was generated.
According to ED sources, the particle sold in the name of MyCloudParticle by VueNow Group cost Rs 41,253 per cloud particle, which is 1 TB of storage. The ED has said the multi-level scheme masterminded by Kharour had generated funds of Rs 3,558 crore.
The ED has claimed that proceeds of crime amounting to Rs 3,558 crore generated out of criminal activities were utilised for other than business purposes and further diverted by M/s VMSL and group companies in giving high commissions to the channel partners, purchase of various luxurious vehicles, gold and diamonds, routing of funds to the tune of hundreds of crores through shell entities and investment in properties.
(Edited by Nida Fatima Siddiqui)
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