ED sources said the 58-year-old actor had been asked to appear before the joint director of the enforcement agency in Chennai on 5 December.
ED officials on November 20, conducted searches in Pranav Jewellers at Tiruchy and Chennai under the provision of PMLA, 2002.
The Enforcement Directorate (ED) summoned actor Prakash Raj for questioning under the provisions of the Prevention of Money Laundering Act (PMLA) of 2022 in connection with the gold-saving schemes of a Tamil Nadu-based jeweller.
The actor, a trenchant critic of the right wing, was the brand ambassador of the gold-saving schemes, among other things.
Taking forward a cheating case filed by the Economic Offence Wing (EOW) of the Tiruchirappalli police against Pranav Jewellers, the ED officials on 20 November conducted searches on properties of the company in Tiruchirappalli and Chennai under the provision of the PMLA.
According to sources in the Tamil Nadu police, Pranav Jewellers was operating from Tiruchirappalli and had branches at Coimbatore, Madurai, Chennai, Kumbakonam, Nagercoil, and Erode. The entity is owned by Madan, his wife Karthika, and their business partner Narayanan.
The sources said the company announced various schemes to lure investors with high returns.
The accused claimed that people who were investing their amounts in gold chits would not be charged wastage on every purchase. The company also apparently announced a bonus for every investment.
The jewellers introduced three gold chit schemes. One was over a duration of 5.5 months (with a bonus). The Rathna Gold Saving Scheme and the Navarathana Gold Saving Scheme had an 11-month maturity period.
In the first scheme, the company assured a bonus of 15 days’ amount to the customers after five months of payment.
In the Rathna Gold savings scheme, it offered a month’s bonus to those who completed the payment of 11 months.
In the Navarathana Gold Savings Scheme, the jewellers announced that customers could buy gold jewellery without any wastage.
Above all, the jewellers said in an advertisement that if a person invested ₹5 lakh, they could earn 2 percent interest on the investment and 106 grams of jewellery in 10 months without any loss or labour charges.
The ED suspected that the jewellers made more than ₹100 crore by floating these gold-saving schemes and could have invested that money in shell companies.
According to a statement issued by the ED, “The searches revealed that the supplier parties in the books of Pranav Jewellers were entry providers, who — during the investigation — confessed to have provided adjustment or accommodation entries to Pranav Jewellers for amounts over ₹100 crore.”
The ED said the suppliers also confessed to having given cash to the accused persons in lieu of bank payments.
actor Prakash Raj in pranav jewellers advertisement
Sources in the ED stated that Mathan and his wife Karthika registered two new companies — Pranav Ventures and Mee Le Pranav Jewellers India Private Limited.
They added the couple paid a huge sum to actor Prakash Raj to be the brand ambassador for their jewellery shop and the gold-saving schemes.
Further, commercial advertisements were made and telecasted on all leading satellite channels and newspapers, urging the people to invest in the gold schemes.
The ED has summoned Prakash Raj to inquire whether he was aware of the gold schemes introduced by the jewellers and about his part in the entity as a brand ambassador.
Sources in the ED told South First that the 58-year-old actor had been asked to appear before the joint director of the ED in Chennai on 5 December.
However, Prakash Raj, who opposed the Union government led by the BJP on several instances, took to social media platform X (formerly Twitter) and posted the now-famous Bengali slogan that translates to “The game is on”, which was seen as a response to the agency’s summons.
— Prakash Raj (@prakashraaj) November 23, 2023
An officer from the EOW of the Tiruchirappalli police said about the case: “Several people from all over the state invested in Pranav Jewellers’ schemes. The company delayed giving them the promised jewels even after the maturity period of the gold chits.”
He added: “More and more people began thronging the jewellery shops in Coimbatore, Chennai, and Tiruchirappalli. Unable to answer them, the owners closed seven branches without any prior announcement.”
Realising that they were cheated, hundreds of such people lodged complaints with the EOW in their respective districts.
Following this, the EOW of the Tiruchirappalli police registered a case against Pranav Jewellers, Madan, Karthika, and Narayanan under Sections 120 B, 406, and 420 of the Indian Penal Code, as well as Section 5 of the Tamil Nadu Protection of Interests of Depositors (in Financial Establishments) or the TNPID Act of 1997.
Furthermore, the EOW sleuths in October conducted raids on Pranav Jewellers’ properties in Coimbatore, where they could find only silver jewels and not even a gram of gold jewellery.
Meanwhile, suspecting money laundering, the ED took the proceeds of crime in the case and also conducted raids at the shops in Chennai and Tiruchirappalli.
During the searches, the ED found and seized various incriminating documents, unaccounted-for cash of ₹23.7 lakh, and bullion and gold jewellery weighing 11.6 kg.
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