The Enforcement Directorate (ED) has initiated a comprehensive investigation into alleged money laundering involving real estate developers and banking officials in the National Capital Region (NCR), registering 22 separate cases under the Prevention of Money Laundering Act (PMLA). The probe follows directives from the Central Bureau of Investigation (CBI), which was instructed by the Supreme Court in April 2025 to examine potential collusion in sanctioning loans under subvention schemes without proper due diligence.
According to officials familiar with the matter, the ED’s Enforcement Case Information Reports (ECIRs)—the agency’s equivalent of FIRs, focus on identifying diverted funds and ensuring recovery for affected homebuyers. Preliminary assessments indicate that the financial exposure could run into thousands of crores. The agency is also concurrently monitoring approximately 162 ongoing real estate fraud cases across the country.
The investigation centers on alleged irregularities in subvention schemes, which operate on a tripartite agreement between buyers, banks, and developers. Under these schemes, buyers typically pay between 5% and 20% upfront, while banks finance the remaining amount directly to developers in instalments. Developers, in turn, are expected to cover interest payments during an initial period, usually until the buyers take possession. Subsequently, buyers start repaying the bank in EMIs. Reports suggest that defaults were widespread in projects launched between 2013 and 2015, with many builders halting pre-EMI payments around 2018–19. Following these defaults, buyers were often asked to continue EMI payments despite the incomplete status of their projects.
Prominent developers named in the ED and CBI filings include Supertech Limited, Logix City Developers Pvt. Ltd., Jaypee Infratech Ltd., Jaypee Sports International Limited, AVJ Developers (India) Pvt. Ltd., Earthcon Universal Infratech Pvt. Ltd., and several others. In addition to developers, officials from leading financial institutions, such as State Bank of India, HDFC Bank, ICICI Bank, PNB Housing Finance, Indiabulls Housing Finance, Tata Capital Housing Finance, and Piramal Finance, have been named in various FIRs. Directors and promoters of multiple real estate companies are also under scrutiny as part of the investigation.
The Supreme Court had directed the CBI to initiate investigations after more than 1,200 homebuyers submitted over 170 petitions, alleging collusion between banks and developers. The complaints claimed that banks disbursed substantial loans to developers even before projects commenced, leaving homebuyers financially exposed when developers defaulted.
ED officials have highlighted that the ongoing probe aims not only to trace diverted funds but also to safeguard homebuyers’ interests. “As part of the money laundering probe, we will locate the money diverted by the builders and help homebuyers recover their invested funds,” said one official, speaking on condition of anonymity.
Image source- enforcementdirectorate.gov.in
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