London (AFP)

The noose is tightening around steel magnate Sanjeev Gupta.

His already cash-strapped GFG group is now under investigation for suspicion of fraud and money laundering, including links to bankrupt company Greensill.

The SFO (Serious Fraud Office), the equivalent of the financial prosecutor's office, "investigates suspicions of fraud, fraudulent trade and money laundering in the conduct of the business of Gupta Family Group (GFG) Alliance companies, including his financial ties to Greensill, "according to a statement Friday.

No further details are provided, "taking into account ongoing investigations".

In a statement sent to AFP, GFG said it had taken note of this announcement and indicated that it "will cooperate fully with the investigation".

The Financial Times recently revealed that suspicious invoices were provided by the Gupta Group to Greensill in exchange for funds.

Gupta, however, had denied any wrongdoing while Greensill was not required to check invoices, according to the daily.

The case is yet another blow to GFG, a group in turmoil since the fall in March of Greensill, a controversial short-term lending company.

GFG was one of his main clients and owed him billions of dollars.

Greensill is for its part the subject of several investigations, for suspicion of accounting fraud linked to its banking activities in Germany and the United Kingdom on the part of the market policeman, who considers that the circumstances of the bankruptcy of the financial company could be of a "criminal nature".

His model was "highly suspect" and resembled a "pyramid fraud", recently said members of the House of Lords also former officials in the British Treasury heard by a parliamentary committee.

- Avoid bankruptcy -

Since the fall of Greensill, the metals empire of Indo-British businessman Sanjeev Gupta has been desperately seeking new funds, in particular to avoid plant closures at his steel arm Liberty Steel.

In its statement Friday, GFG specifies that it continues to serve its customers around the world and that it "is making progress in refinancing its operations", which also benefit from the recent rise in steel prices, aluminum and iron ore markets.

A source familiar with the matter told AFP last week that Liberty Steel in the UK was about to close a £ 200million loan with investment firm White Oak.

This money, if the agreement is successful, should represent a breath of fresh air for the group and allow it to avoid bankruptcy for the time being.

The government had previously refused to lend him funds, citing the "opaque" nature of GFG.

Sanjeev Gupta told him in early April not to expect a "rescue of anyone" and had promised not to close steel plants in the UK while he was in charge.

As a sign of his difficulties, Sanjeev Gupta has decided to no longer finance the bank Wyelands Bank, which belongs to his group.

This bank has reimbursed almost all of its customers and is looking for buyers, otherwise it will be liquidated.

GFG employs around 5,000 people in the United Kingdom, the majority of whom are at Liberty Steel, and 35,000 worldwide, with sites in France such as the Ascoval steelworks in Saint-Saulve (north) and the Hayange rail factory. (Moselle).

In parallel with its quest for new financing, Liberty Steel said last week that it had launched the search for buyers for its French sites Ascoval and Hayange.

© 2021 AFP