Inside India’s Biggest Financial Institution Fraud

The Law Enforcement Directorate has secured crores of property prices from developers Sanjay Chhabria and Avinash Bhosale, who are accused in the Rs 34,615 crore Yes Bank-DHFL scam. A duplex apartment costing Rs 102.8 crore, plots of land, high-end luxury vehicles and an AgustaWestland helicopter had been seized so far

Investigations are underway into India’s biggest financial institution fraud – the Rs 34,615 crore DHCP scam case. On Wednesday, the Enforcement Directorate (ED) priced the Rs 415 crore property of two developers Sanjay Chhabria of Radius Developers and Avinash Bhosale of ABIL Infrastructure and Metropolis Hotels.

They had been arrested earlier this year in the Yes Bank-DHFL (Dewan Housing Finance Limited) case which resulted in an alleged loss of several crores for a consortium of 17 banks led by the Union Bank of India between 2010 and 2018.

Bhosale was arrested once by the Central Bureau of Investigation (CBI) in May. Subsequently, on Monday, the CBI filed an additional costs sheet in the Yes Bank-DHFL fraud case against him.

The company alleged that its investigation revealed that former DHLF promoters Kapil Wadhawan and Dheeraj Wadhawan, Rana Kapoor, co-founder of Yes BankRadius Group builder Sanjay Chhabria, Avinash Bhosale and businessman Satyan Gopaldas Tandon conspired to deceive the financial institution and consortium.

We’re checking out the case and what’s been recovered from the raids so far.

Catering: Duplex apartment, luxury vehicles, and land

The Enforcement Directorate (ED) has priced the property at Rs 415 crore from developers Chhabria and Bhosale.

A plot of land in Santacruz suburb of Mumbai costs Rs 116.5 crore, 25 million cents equity shares of Chhabria company held in a plot of land located in Bengaluru costs Rs 115 crore, another apartment in Santacruz cost Rs 3 crore, income from a lodge in Delhi airport price Rs 13.67 crore and 3 high-end luxury vehicles belonging to Sanjay Chhabria price ₹ 3.10 crore had been seized, in line with a NDTV registration.

A duplex apartment priced at Rs 102.8 crore owned by Bhonsale was once set up in Mumbai. Other builder assets that have been connected include two plots of land in Pune priced at Rs 14.65 crore and Rs 29.24 crore, another in Nagpur priced at Rs 15.52 crore and another piece of land located in Nagpur which is valued at Rs 1.45. crore, studies NDTV.

A seized helicopter

On Saturday, the CBI seized a AgustaWestland Helicopter Bhosale premises in Pune. The helicopter is said to have been purchased through Varva Aviation, owned by an association of people, in 2011.

An AgustaWestland helicopter has already been seized from the premises of manufacturer Avinash Bhosale in Pune

The CBI investigation revealed that RKW Developers Private Limited, an organization owned by Wadhawan’s circle of relatives, allegedly has stakes in Varva Aviation. The company joined the Association of People in 2017 by contributing against the value of the costs and maintenance of the helicopter, according to studies The Indian Express.

After the investigation company realized that the money used to make the cost against the stake in Association of People came from loans received from a bank in the Union, it seized the helicopter.

The DHLF scam

Founded in 1984, DHLF is a restricted housing finance company, created to offer home loans to middle-income teams. As a Non-Banking Financial Company (NBFC), it is not allowed to accept deposits from other people. However, an NBFC can take out loans from custodian banks in accordance with the regulations of the Reserve Bank of India (RBI).

DHLF belongs to the influential business circle of parents in Mumbai – the Wadhawans. The main responsible at the back of the company was once Kapil Wadhwan, the managing director when the scam was carried out. His brother Dheeraj was once one of the vital promoters.

The Union Bank of India has alleged that the Wadhawan brothers in a criminal conspiracy with others distorted and concealed information, committed breach of criminal belief and abused the public budget to deceive the consortium to chant Rs 34,614 crore by not repaying mortgages from May 2019. .

The audit of the accounting books of DHFL confirmed that the company allegedly spent monetary irregularities, embezzled the budget, fabricated books and went back and forth to “create assets for Kapil and Dheeraj Wadhawan” the use of the public money. The DHL mortgage accounts had been declared non-performing assets at other deadlines through the lending banks.
When DHCP was investigated in January 2019 after media investigations into allegations of budget embezzlement surfaced, the lending banks held a meeting on February 1, 2019 and appointed KPMG to conduct an “audit Special Examination” of DHFL from April 1, 2015 to December 31, 2018.

The UBI alleged that KPMG, in its audit, reported misappropriation of budget under the guise of loans and advances to similar and interconnected entities and persons of DHFL and its directors.

Yes Bank co-founder Rana Kapoor could be charged in the case. PTI

Review of books of account confirmed that 66 entities having commonalities with DHFL promoters had received Rs 29,100 crore of which Rs 29,849 crore remained outstanding. Another significant item in the DHFL accounts was formerly Rs 11,909 crore from the price of Rs 24,595 crore loans and advances granted to 65 entities between April 1, 2015 and December 31, 2018.

The DHFL and its promoters also doled out Rs 14,000 crore as Project Finance mirrored the same as retail loans on their books. This resulted in the introduction of a bloated retail loan portfolio of 1,81,664 bogus and non-existent retail loans totaling a remarkable Rs 14,095 crores.

The DHFL, its directors and bosses have remained on course as they seek to de-stress the business through several approaches such as securitization of the mortgage loan pool, loan underwriting and disposal of developer stake within the company.

Kapil Wadhawan persevered to deal with the fact that DHFL had six months of monetary liquidity and would remain in monetary surplus even after taking into account all compensation duties, the financial institution claimed. After ‘falsely reassuring’ the lenders, DHFL failed to redeem on time the loan projects on terms in May 2019 which continued thereafter with accounts declared non-performing assets, they said.

Arrests

In May 2020, the ED arrested Kapil and Dheeraj Wadhwan.

Rana Kapoor could be in custody.

The CBI on Monday filed an additional costs sheet against Bhonsale and Satyan Tandon in an alleged corruption case in a Mumbai court.

CBI alleged that Tandon’s company, Wizard Construction India Pvt Ltd, had obtained amounts from Chhabria’s Radius Group and that these were among the loans distributed through Yes Bank to DHL that had been misappropriated.

With business contributions

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