Mumbai: The Enforcement Directorate (ED) on Friday carried out search operations at over 15 locations in Mumbai and Kochi in connection with the alleged Rs 65.54 crore Mithi River desilting scam involving senior Brihanmumbai Municipal Corporation (BMC) officials, private contractors, and middlemen.
Among the premises searched was the residence of Bollywood actor Dino Morea, a close friend of Shiv Sena (UBT) leader Aaditya Thackeray. The ED reportedly acted on leads suggesting financial links between Morea and one of the arrested middlemen, Ketan Kadam.
The EOW summoned and questioned actor Dino Morea and his brother twice after it emerged that Morea had known middleman Kadam for over two decades, with Kadam playing a leading role in the scam. Financial transactions between Kadam and Morea reportedly raised suspicion, prompting ED officials to conduct searches of the actor's Bandra based residential and official premises.
According to sources, the ED’s search operations focused on individuals named in a First Information Report (FIR) filed by the Economic Offences Wing (EOW) of the Mumbai Police last month. The FIR lists 13 accused, including BMC assistant engineer Prashant Ramugade, retired deputy chief engineers Ganesh Bendre and Prashant Tayshette, and contractors associated with firms such as Acute Designing, Kailash Construction Company, NA Construction, Nikhil Construction, and JRS Infrastructure.
In Kerala, the ED’s searches targeted Matprop Technical Services Pvt Ltd, a Kochi-based company that allegedly supplied desilting machinery to BMC-appointed contractors.
The EOW had booked the accused for causing wrongful loss to the civic body amounting to over Rs 65.54 crore. Based on the EOW’s predicate offence, the ED registered an Enforcement Case Information Report (ECIR) last month and initiated a money laundering investigation.
Sources said the ED is scrutinising the flow of funds and the involvement of shell companies allegedly used to route money linked to fake desilting claims. The agency suspects that large sums were siphoned off through forged documents and inflated bills submitted during the Mithi River cleanup drives.
Investigations revealed that engineers from the Storm Water Drain (SWD) division allegedly cleared contractor bills based on false weighbridge receipts and forged memoranda of understanding (MoUs) related to sludge dumping sites. The EOW probe found that contractors submitted at least nine fake MoUs, systematically using forged documentation to siphon off civic funds earmarked for flood mitigation desilting work on the Mithi River.
The Mithi River desilting project, part of post-2005 flood mitigation efforts, involved contracts worth nearly Rs 1,100 crore. The river, which runs through Mumbai and drains into the Arabian Sea, is crucial for stormwater management but has long suffered from illegal dumping and pollution.
The EOW FIR stated that the accused BMC officers of the SWD division, without verifying the authenticity of dumping sites mentioned in fabricated MoUs submitted by contractor firms, facilitated undue financial gains. It further alleged that SWD officials caused financial loss to the BMC by approving bills based on fake weighbridge receipts and falsified log sheets.
An investigation revealed multiple financial irregularities related to contracts for desilting the Mithi River between 2021-22 and 2022-23. These irregularities primarily involved the transportation and dumping of sludge. Subsequent investigations by the Economic Offences Wing (EOW) uncovered that contractors had submitted nine fake memoranda of understanding (MoUs) as part of the scam.
Sources said the investigation focuses on inflated bills, fabricated work logs, and systematic siphoning of funds allocated for cleaning and maintenance of the Mithi River. The river had gained national attention after the devastating 2005 floods and has since been the subject of regular desilting operations funded by the BMC and other civic agencies.
ED officials are closely scrutinising financial transactions related to desilting contracts. According to sources, shell companies were allegedly floated to route laundered funds, with several suspicious transactions under examination.
The Special Investigation Team (SIT) under the EOW has already arrested two middlemen, Ketan Kadam and Jay Joshi. Joshi owns Virgo Specialties Pvt Ltd, while Kadam is associated with Vodar India LLP. The EOW seized electronic devices from Kadam and copies of posting orders of officials in the BMC’s SWD department.
Officials indicated that more arrests may follow as investigations by the EOW and ED expand into alleged misuse of public funds and procedural violations in civic projects.
