Ramesh Bawa of IL&FS Financial Services Arrested in Delhi by SFIO

Moneylife Digital Team 13 April 2019

The Serious Frauds Investigation Office (SFIO) is understood to have arrested Ramesh C Bawa, former chief executive (CEO) of IL&FS Financial Services (IFIN), who had switched off his phone and vanished after the Supreme Court of India dismissed his petition challenging the SFIO’s powers to arrest him.

Sources in the know told us that Mr Bawa was holed up with a friend and tracked down towards midnight by questioning his family members.

Moneylife was the only publication to report that Mr Bawa had gone missing and had switched off his phone. As we reported on 11th April, Mr Bawa lives at Greater Kailash Part 1 in New Delhi. On enquiring at his home landline number, we were told that he was not at home. The person who answered the call, passed the phone to ‘madam’ , who we assume was his wife. She informed us that she was unaware of Mr Bawa’s whereabouts and that she had no idea if he had plans for any other legal action. When Moneylife tried calling Mr Bawa on his mobile number, it was indeed switched off.

Sources say the agency will now follow the laid down procedure and he may be brought to Mumbai for further questioning.

The SFIO, which is probing the Infrastructure Leasing and Financial Services Ltd (IL&FS) fraud, had issued summons to several former senior executives of IL&FS, including Mr Bawa. As much as 90% of the loans advanced by IFIN, the lending arm of the infrastructure conglomerate IL&FS have turned bad. Interpol notices have been issued against all the key members of the management cabal that worked closely with Mr Ravi Parthasarathy, founder of IL&FS, who ruled the 346 company conglomerate with unfettered powers and pliant boards for over 25 years.

IL&FS vice chairman, Mr Hari Sankaran, is already in SFIO custody. However, the founder and past chairman Ravi Parthasarathy has not been touched on humanitarian grounds since he is undergoing treatment. However red cornor notices have been issued against him too and he is no longer allowed to go to London for treatment.

As reported by Moneylife, almost 90% of the loans advanced by IFIN have turned bad underlining the deep corruption and culpability of the previous management. Of its loan book of Rs18,805 crore, Rs10,656 crore was lent to third-party borrowers and nearly Rs7,000 crore to group companies, N Sivaraman, chief operating officer at IL&FS group, has revealed.

According to Kaushik Modak, who now heads IFIN, the company has recovered Rs931 crore since the new board led by banker Uday Kotak took over the IL&FS Group.

Comments

User

Ashok S

5 years ago

Well said Rajiv,in 2008 in Satyam scam PriceWaterhouseCoopers (PWC) the auditors were fines to the tune of nearly 200 crores for the loss incurred by American investors by New York Stock Exchange as ther is a provision to do so but as there is no such provision as per Indian laws against auditing firm the entire loss was observed by Indian Poor Investors.Why not Punish Delotte to the tune of 25 billion USD.

Asheem Srivastav

5 years ago

Kindly let people know the impact of IL&FS scam on share market, if any

Rajiv Gupta

5 years ago

IL&FS is the biggest scam in the recent times & proving to be a black hole. None of the shareholders representative ever bothered about being vigilant & stem the rot. Like Sankaran & Bawa, they were also responsible & therefore held liable & put into jail. You cannot believe that they did not dip their fingers in the pie. Therefore, all criminals should be treated alike. The rating agency should be held liable & once again those responsible should be put into jail. No scam of 1 lakh Crore magnitude can happen without the blessings of the auditors. Therefore those responsible in Deloitte should be put behind the bars. Remember the case of Rajat Gupta of Mckinsky in US, all those responsible should be behind the bars. We are not talking about layman or uneducated fools but highly qualified & well regarded officials. If they were chosen to be in that position, they are responsible for the consequences. The cheats pay for the crimes.
Even in 2014, the GoI allowed them to issue RCPs, which is actually a hybrid & generating tax free incomes. It appears that several MNCs invested in that the pension & PF funds of the employees. The GoI is directly responsible for stopping cheating in this case because institutions like SBI & LIC of India & HDFC (one of the best) are involved. If they failed to see & assess the truth then you cannot have confidence in these institutions also! Is it really acceptable to the GoI. Therefore, the GoI needs to take the responsibility.
What about the mother company i.e. IL&FS Ltd. What is the status of this company? Is it down the drain then why we should have a new Board. Is it to ensure that people are given false assurance of something being done but actually nothing will happen. Is this not cheating once again?
Lastly, reportedly, the GoI is settling the liability of the International institutions because of the fear of losing faith in making investments being safe in India. Is this really, the correct thing to do? No, once again this is cheating? Why no priorities are being set to take care of the individual investors who have put in their lifetime savings into the company? Is suicide the only solution for these people? Why & how the government is least bothered?

MIHIR AVINASH KULKARNI

5 years ago

There's Moneylife on one side and then there's the rest. Kudos! God bless; more power to you and Team.

Hudaf Shaikh

5 years ago

Welcome step - the British Courts have not just denied bail to Nirav Modi but also thrown him in a third class jail with druggies and murderers for scamming PNB of $ 1 billion.

Our courts should not just throw Bawa and Sankaran but entire team of directors of IL&FS for the $15 billion scam which has impacted retirement savings of millions of people.

B. Yerram Raju

5 years ago

Congratulations for making bandicoots come out of the hole to go to the cell.