NEW DELHI: The Enforcement Directorate (ED) has arrested Kolkata-based realtor Paras Mal Lodha for laundering crores in scrapped notes, causing ripples of anxiety in legal and other circles in the capital and elsewhere.The ED started questioning Lodha three days ago when it found that he had helped Delhi lawyer Rohit Tandon and Chennai-based sand mining baron Shekhar Reddy convert crores of outlawed notes into new ones. ED's probe into the allegedly illegal stashes found with Tandon and Reddy led to the money trail to Lodha, known for his rich network of contacts. ED sources said Lodha had admitted to having converted Rs 25 crore and Rs 18 crore belonging to Tandon and Reddy, after charging a premium of 15-20%. He had first denied having washed black money, saying the cash trail linking him to Tandon was from a property deal. Lodha, a businessman, emerged as an influential figure in Kolkata's real estate sector in the 1990s.There was considerable drama when Lodha was produced in a Saket court on Thursday with the businessman, who made it big by acquiring roof rights in Kolkata's buildings, reversing his stand not to engage counsel after speaking with his wife in the full courtroom. His counsel, who arrived suddenly, asked for the media and others to be removed from the court room before his client recorded his statement. The court later granted the ED permission to keep the businessman in their custody for seven days for further questioning.Lodha's arrest and the multi-agency probe which led to it is being watched with fascination because of his link with Tandon, the mysterious lawyer who, going by the money found on him, appears to be wealthier than his peers with storied reputation. The ED's claim that Tandon gave Rs 18 crore to Lodha takes the total amount found with Tandon, who left Delhi some time ago when he acquired the plush bungalow of Ruias in the capital's leafy Jor Bagh for Rs 100 crore, to more than Rs 170 crore -something which has led many to suspect whether he was handling money of others.The expanding probe into the fortunes of Tandon and Reddy has put the spotlight on what ED sources say is the countrywide network of money launderers who became busy after demonetisation was announced on November 8 and helped people convert the invalidated cash into valid currency, new and old. The I-T raids on TN chief secretary Rama Mohana Rao, who was removed on Thursday, suggests it is not just lawyers and businessmen but also bureaucrats who could have availed of the services of Lodha and others like him.ED sources said Lodha “admitted“ to having operated through bank employees, largely low-ranking, he has cultivated. The sources said he denied committing any illegality, claiming that his job was limited to connect those who needed each other. Of course, that was before he changed his mind and decided, through his laywer, to record a statement while insisting that except for the ED's investigating officer, others left the court.