India court orders Jet Airways founder to remain in custody until Sept. 11

(Reuters) -An Indian court on Saturday decided that Jet Airways founder Naresh Goyal will remain in India’s financial crime agency’s custody until Sept. 11, the agency said in a press statement.

The Enforcement Directorate (ED), which investigates financial crimes in India, arrested Goyal late on Friday.

Jet Airways did not immediately respond to a request for comment. Goyal hasn’t commented publicly on the case in the past.

The case relates to an alleged 5.38 billion Indian rupees ($65.06 million) bank fraud case filed by state lender Canara Bank. The losses to a consortium of nine lenders is much larger, at 59.6 billion Indian rupees ($720.78 million), ED said.

The bank had filed a complaint in May against the airline, Goyal, his wife and a former airline director for “causing wrongful loss” to the lender.

Goyal founded Jet Airways in 1992 but shut down operations in April 2019 after running out of cash. The airline was the second largest carrier in India by market share.

In its statement the agency said that under Goyal’s leadership the airline siphoned off funds to overseas entities in Dubai, Ireland and other tax havens including the British Virgin Islands.

“(The) ED investigation revealed that in the garb of professional and consultancy fees, funds to the tune of 10 billion Indian rupees ($120.94 million) went towards the personal expenses of Naresh Goyal and his family members,” the statement said.

($1 = 82.6887 Indian rupees)