The promoters of the Mumbai-based NBFC (non-banking financial firm), DHFL, along with 73 other people have been charged by the Central Bureau of Investigation (CBI) in a case involving a Rs 34,614 crore bank fraud.
In the largest bank fraud case, former DHFL CEO Harshil Mehta is also charged in the chargesheet presented to a special CBI court. The issue had been reported to the agency in June of this year. The chargesheet lists 57 entities and 18 people in total as the conduit for the funds’ diversion.
The FIR claims that DHFL, its then-Chief and Managing Director Kapil Wadhawan, Director Dheeraj Wadhawan, businessman Sudhakar Shetty, and other accused engaged in a criminal conspiracy to cheat the consortium of 17 banks, which was headed by the Union Bank of India.
By convincing the banks to accept large loans totaling Rs 42,871 crore, Kapil Wadhawan and others illegally manipulated the DHFL’s books, syphoned off and stole a huge proportion of the funds, and dishonestly failed to pay the consortium banks’ legitimate debts. The consortium lenders incurred an unwarranted loss of Rs 34,615 crore as a result.
Charges of cheating, fraud, and violations of relevant parts of the Prevention of Corruption Act have been filed against each and every accused. Since 2010, banks have started providing loans to the accused businesses. Over Rs 34,615 crore worth of loans were classified as non-performing assets (NPA) in 2019.
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