CBI Says Wadhawan Routed Rs115 Crore To Jack Up DHFL Shares in 2018: Report

Moneylife Digital Team 15 July 2022

Investor Interest

The central bureau of investigation (CBI) in its supplementary chargesheet in the Yes Bank-Dewan Housing Finance Ltd (DHFL) case alleged that Kapil Wadhawan, erstwhile promoter of DHFL, routed Rs115 crore to a market operator in September 2018 to jack up the company’s share prices, says a report.

Quoting from the chargesheet, a report from Economic Times says, “The fall in share prices is learned to be caused by two reasons: a) RBI refusal to grant extension of Rana Kapoor, as managing director and chief executive officer (MD&CEO) of Yes Bank and, b) reported sale of commercial papers worth Rs200 crore of DHFL by DSP Meryl Lynch.”

"The fall prompted Kapil Wadhawan to contact market operator Sanjay Dangi and transfer Rs115 to the latter’s company Mentor Capital by sanctioning and disbursing loan of Rs678 crore to another company Flag Industries India Pvt Ltd (FIIPL). Of the said loan, Rs115 crore was transferred on the same day to Mentor Capital by FIIPL," the report says.

Last month, CBI booked Kapil and Dheeraj Wadhawan, former promoters of DHFL, for allegedly defrauding 17 banks for Rs34,615 crore. The agency also conducted searches at about 15 locations in Mumbai related to the DHFL case.

The Wadhawans and others induced the consortium banks to sanction huge loans aggregating Rs42,871.42 crore and siphoned off and misappropriated a significant portion of the said funds by falsifying the books of DHFL and dishonestly defaulted on repayment of the legitimate dues of the said consortium banks. They caused a wrongful loss of Rs36,615.00 crore to the consortium lenders.

In March 2020, a case of loan fraud of Rs3,600 crore was lodged by the CBI against Mr Kapoor, the then promoter director and CEO of Yes Bank, for entering a criminal conspiracy with Kapil Wadhawan, promoter director of DHFL and others.

They extended financial assistance to DHFL by Yes Bank in lieu of substantial undue benefit to himself and his family members through their companies.

Between April and June 2018, Yes Bank invested Rs3,700 crore in the short-term debentures of DHFL. Simultaneously, Mr Wadhawan paid a kickback of Rs600 crore to Mr Kapoor and his family members in the garb of builder loan of Rs600 crore given by DHFL to DOIT Urban Ventures (lndia) Pvt Ltd, a wholly-owned subsidiary of RAB Enterprises (lndia) Pvt Ltd, in which Bindu Kapoor, wife of Mr Kapoor, is a director and 100% shareholder.

Mr Kapoor's daughters, Roshini Kapoor, Radha Kapoor Khanna and Raakhe Kapoor Tandon, were 100% shareholders of DOIT Urban Ventures through Morgan Credits Pvt Ltd.

It was learnt that DHFL sanctioned a loan of Rs600 crore to DOIT Urban Ventures on the basis of a mortgage of a sub-standard property having a very meagre value and by considering its future conversion from agricultural land to residential land.

Also, DHFL had not redeemed the Rs3,700 crore invested by Yes Bank in its debentures. In addition to the above-mentioned, Yes Bank also sanctioned a loan of Rs750 crore to RKW Developers Pvt Ltd, which is a DHFL group company, for their Bandra Reclamation project.

The whole amount was siphoned off by Mr Wadhawan since RKW Developers transferred the entire amount to DHFL without making an investment in Bandra Reclamation project for which the loan was sanctioned.

Thus, Mr Kapoor obtained undue pecuniary advantage from DHFL through the companies his wife and daughters held. It was also learnt that Mr Kapoor had obtained illegal kickbacks directly or indirectly through entities controlled by him or his family members. (Read: DHFL-Yes Bank Scam: CBI Recovers Incriminating Documents in Raids)

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