Assets worth Rs 415 crore, duplex flat, helicopter: Inside India’s biggest bank fraud

Investigations are underway into India’s biggest bank fraud – the Rs 34,615-crore DHFL scam case . On Wednesday, the Enforcement Directorate (ED) attached assets worth Rs 415 crore from two builders Sanjay Chhabria of Radius Developers and Avinash Bhosale of ABIL Infrastructure and Metropolis Hotels. They were arrested earlier this year in the Yes Bank-DHFL (Dewan Housing Finance Limited) case that caused an alleged multi-crore loss to a consortium of 17 banks led by the Union Bank of India between 2010 and 2018. Bhosale was arrested by the Central Bureau of Investigation (CBI) in May. Subsequently, on Monday, the CBI filed a supplementary charge sheet in the Yes Bank-DHFL fraud case against him. The agency has alleged that its investigation has revealed that erstwhile DHLF promoters Kapil Wadhawan and Dheeraj Wadhawan, Yes Bank co-founder Rana Kapoor , builder Sanjay Chhabria of the Radius Group, Avinash Bhosale and businessman Satyan Gopaldas Tandon, conspired to cheat the bank and the consortium. We take a look at the case and what has been recovered so far from raids. The recovery: Duplex flat, luxury cars, and land The Enforcement Directorate (ED) attached assets worth Rs 415 crore from builders Chhabria and Bhosale. A land parcel in Mumbai’s suburban Santacruz worth Rs 116.5 crore, 25 per cent equity shares of Chhabria’s company held in a land parcel located at Bengaluru worth Rs 115 crore, another flat in Santacruz worth Rs 3 crore, profits from a hotel at Delhi airport worth Rs 13.67 crore and three high-end luxury cars belonging to Sanjay Chhabria worth ₹ 3.10 crore were seized, according to an NDTV report. A duplex flat worth Rs 102.8 crore belonging to Bhonsale was attached in Mumbai. Other assets of the builder that were attached include two land parcels in Pune worth Rs 14.65 crore and Rs 29.24 crore, another one in Nagpur worth Rs 15.52 crore and another portion of land located in Nagpur which is valued at Rs 1.45 crore, reports NDTV. A helicopter seized On Saturday, the CBI seized an AgustaWestland helicopter from the premises of Bhosale in Pune. It is alleged that the helicopter was purchased by Varva Aviation, owned by an Association of Persons, in 2011. [caption id=“attachment_11004311” align=“alignnone” width=“640”]  An AgustaWestland helicopter was seized from the premises of builder Avinash Bhosale in Pune[/caption] The CBI investigation revealed that RKW Developers Private Limited, a company owned by the Wadhawan family, allegedly has stakes in Varva Aviation. The firm joined the Association of Persons in 2017 by contributing towards the cost price and maintenance of the helicopter, reports The Indian Express. After the probe agency realised that the funds used for making the payment towards the stake in Association of Persons were sourced from loans obtained from a Union Bank, it seized the helicopter. The DHLF scam Established in 1984, DHLF is a housing finance limited company, established to provide home loans to middle-income groups. As a non-banking finance company (NBFC), it is not permitted to take deposits from people. However, an NBFC can take loans from depository banks as per the Reserve Bank of India (RBI) rules. DHLF is owned by the influential business family from Mumbai – the Wadhawans. The main man behind the company was Kapil Wadhwan, the managing director when the scam was pulled off. His brother Dheeraj was one of the promoters. The Union Bank of India has alleged that the Wadhawan brothers in criminal conspiracy with others misrepresented and concealed facts, committed criminal breach of trust and abused public funds to cheat the consortium to the tune of Rs 34,614 crore by defaulting on loan repayments from May 2019 onward. The audit of DHFL account books showed that the company allegedly committed financial irregularities, diverted funds, fabricated books, and round-tripped funds to “create assets for Kapil and Dheeraj Wadhawan” using public money. The DHFL loan accounts were declared non-performing assets at different points in time by lender banks. When DHFL was hit by an investigation in January 2019 after media reports on allegations of siphoning off funds surfaced, the lender banks held a meeting on 1 February 2019 and appointed KPMG to conduct a “special review audit” of DHFL from 1 April 2015 to 31 December 2018. The UBI has alleged that KPMG, in its audit, red-flagged diversion of funds in the garb of loans and advances to related and interconnected entities and individuals of DHFL and its directors. [caption id=“attachment_11004321” align=“alignnone” width=“640”]  Yes Bank co-founder Rana Kapoor is also an accused in the case. PTI[/caption] The scrutiny of account books showed that 66 entities having commonalities with DHFL promoters were disbursed Rs 29,100 crore against which Rs 29,849 crore remained outstanding. Another major outstanding in DHFL accounts was Rs 11,909 crore arising out of loans and advances worth Rs 24,595 crore given to 65 entities between 1 April 2015 and 31 December 2018. The DHFL and its promoters also disbursed Rs 14,000 crore as Project Finance but reflected the same as retail loans in their books. This led to the creation of an inflated retail loans portfolio of 1,81,664 false and non-existent retail loans aggregating Rs 14,095 crore outstanding. The DHFL, its directors and executives kept maintaining that they were trying to de-stress the company through various means like securitisation of the pool of housing loans, project loans, and divestment of promoters’ stake in the company. Kapil Wadhawan continued to maintain that DHFL had six months of cash liquidity and would remain in a cash surplus even after considering all repayment obligations, the bank alleged. After having “falsely assured” lenders, the DHFL delayed interest payment obligations to terms loans in May 2019 which continued thereafter with accounts declared non-performing assets, they said. The arrests In May 2020, the ED arrested Kapil and Dheeraj Wadhwan. Rana Kapoor is also in judicial custody. The CBI filed a supplementary charge sheet against Bhonsale and Satyan Tandon in a case of alleged corruption in a Mumbai court on Monday. CBI has alleged that Tandon’s firm Wizard Construction India Pvt Ltd received amounts from Chhabria’s Radius Group and that these were part of loans disbursed by Yes Bank to DHFL which were being diverted. With inputs from agencies Read all the Latest News , Trending News ,  Cricket News , Bollywood News , India News and Entertainment News here. Follow us on Facebook, Twitter and Instagram.