The ED has uncovered a Rs 41 crore money laundering trail in the VVMC illegal construction scam involving 41 buildings. Assets worth Rs 12.71 crore were frozen, and Rs 26 lakh cash seized. The probe exposes deep corruption among builders, VVMC officials, and agents. Investigations continue.
In a major breakthrough in the Vasai-Virar Municipal Corporation (VVMC) land scam, the Enforcement Directorate (ED) has unearthed a money laundering trail worth approximately Rs 41 crore. The agency conducted extensive searches across 16 locations in Mumbai on July 1, 2025, under the Prevention of Money Laundering Act (PMLA), 2002, intensifying its ongoing investigation into the illegal construction racket.
According to the ED’s official statement released on Thursday, the latest operations resulted in the freezing of assets worth Rs 12.71 crore, including balances in bank accounts, fixed deposits, and mutual funds. Additionally, the agency seized Rs 26 lakh in cash and recovered incriminating documents, digital devices, and evidence suggesting a vast network of corruption.
Roots of the Scam: 41 Illegal Buildings
The investigation stems from multiple FIRs filed by the Mira Bhayandar Police Commissionerate, which accused a group comprising builders, local henchmen, and VVMC officials of orchestrating a massive illegal construction scheme. At the heart of the scandal is the unauthorised development of 41 residential-cum-commercial buildings on both government and private land designated for sewage treatment and waste disposal.
The buildings, some dating back to 2009, were constructed in gross violation of the city’s approved development plan. These illegal structures were then sold to unsuspecting homebuyers using forged approval documents. According to the ED, the developers were fully aware of the unauthorised nature of their constructions but continued to market and sell the units for personal gain.
Court Orders and Demolitions
The Bombay High Court, recognizing the extent of illegality, ordered the demolition of all 41 buildings on July 8, 2024. A Special Leave Petition filed by the affected residents was dismissed by the Supreme Court, paving the way for the Vasai-Virar Municipal Corporation to execute the demolition orders. The demolition process was completed on February 20, 2025, marking a significant step in reclaiming the encroached land.
Nexus of Corruption and Black Money
The ED’s probe has revealed a complex nexus involving architects, chartered accountants, liaison agents, and VVMC officials. The digital devices seized during the raids reportedly contain damning evidence of collusion, black money circulation, and manipulation of building approvals through forged documents.
This organised cartel is believed to have systematically exploited regulatory loopholes to facilitate the construction and sale of illegal buildings. ED sources suggest that widespread corruption enabled the scam to flourish for over a decade, with bribes and kickbacks exchanged to ensure that illegal activities went unchecked.
Earlier Raids Exposed Lavish Gains
The current operation builds upon earlier raids conducted in May 2025, which led to the seizure of Rs 8.68 crore in cash and diamond-studded jewellery and bullion worth Rs 23.25 crore. These findings highlighted the lavish lifestyle and disproportionate assets amassed by the accused parties.
One senior official from the VVMC town planning department is reportedly under the scanner, with significant unaccounted wealth discovered during the search of his premises. This development has intensified the focus on how municipal officers allegedly abused their official positions to aid illegal constructions and conceal financial irregularities.
Ongoing Investigation and Future Action
The Enforcement Directorate has confirmed that the investigation is far from over. Authorities are now working to trace the broader money trail, identify additional beneficiaries of the scam, and build a watertight case against those involved.
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The case stands as a stark reminder of the systemic corruption that can infiltrate urban planning and governance. As the probe deepens, further revelations are expected to come to light, potentially implicating more influential figures in this high-stakes scandal.
