The Directorate of Enforcement (ED), Kochi Zonal Office, conducted search operations on July 31 at two locations in Kasaragod, Kerala, under the Foreign Exchange Management Act (FEMA), 1999.
The raids were carried out in connection with alleged violations involving foreign contributions received by Kunhahmed Musliyar Memorial Trust and its Chairman, NRI Ibrahim Ahmad Ali.
According to the ED’s preliminary probe, the Trust has received over ₹220 crore since 2021 from Ibrahim Ahmad Ali, shown in its books as “unsecured loans”. However, there are no loan agreements, no interest terms, no repayment schedules, and no repayments have been made so far.
The funds originated from M/s Universal Lubricants LLC, UAE. In the absence of proper documentation, the ED has noted that these inflows qualify as foreign contributions under Section 2(1)(h) of the FCRA, 2010. However, the Trust is not registered under FCRA and does not hold a designated FCRA bank account, making such receipts illegal.
The probe also revealed that part of these foreign contributions was used to purchase agricultural land, violating regulatory norms. Additionally, the Trust reportedly received ₹2.49 crore in cash from Ibrahim Ahmad Ali, also contravening FEMA provisions.
During the raids, ED officials seized incriminating documents, ledgers, a cash book, and a hard disk containing financial data.
The ED said the case points to serious contraventions of FEMA, 1999, and further investigation is underway.
