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Singh brothers stole funds over 8 years: ED’s charge sheet
Apart from the Singh brothers, the agency has named Sunil Godhwani, ex-chairman and managing director (CMD) of Religare Enterprises Ltd (REL) and holding company RHC Holdings Pvt. Ltd in its charge sheet.
The Enforcement Directorate on Friday filed a charge sheet against Fortis Healthcare founders Shivinder Mohan Singh and Malvinder Mohan Singh alleging that the brothers used two sets of “conduit companies” to funnel funds from finance company Religare Finvest Ltd over a span of eight years, two investigating officials said. A large part of this money was used to buy property and there was no intention of repaying the money , they added.
The agency has accused the brothers of money laundering.
Apart from the Singh brothers, the agency has named Sunil Godhwani, ex-Chairman and managing director (CMD) of Religare Enterprises Ltd (REL) and holding company RHC Holdings Pvt Ltd in its charge sheet.
Special ED Prosecutor Nitesh Rana informed the court that there was systematic layering and evergreening of loans processed under the CLB (corporate loan book) portfolio of Religare Finvest to make sure these were not categorized as non-performing assets (NPAs). The court took cognizance of the charge sheet and asked that all accused be produced before it on January 20.
The agency has claimed that out of a total of ₹47,968 crore of loans given to 115 companies by Religare, ₹2,036.69 crore was moved to 19 companies, which defaulted. Most of these funds were used for the personal gain of the Singhs, the charge sheet claims.
Detailing the role of the “conduit companies”, one of the two investigators said that a team of executives at Religare Finvest, on the instructions of Godhwani and the Singh brothers, set up companies referred to as the BAP Group (Best Group, AD Group and Property Group). Several persons questioned by ED have admitted to this, this officer added.
The second officer, who also asked not to be named, said the effective control of BAP Group companies was with the Singh brothers who made a systematic effort to distance themselves from them to avoid any legal connection. Several unsecured loans were given to BAP Group companies on verbal directions without adequate due diligence, documentation or end use monitoring, the officer added.
The second set of “conduit companies” was managed by a long time associate of the Singh brothers, Narendra Kumar Ghoshal, the charge sheet said.
Malvinder Singh’s lawyer Manu Sharma said: “It’s a big zero case. ED is trying to justify the arrest now with some cooked up baseless and illegal story that won’t stand in the court”.
The lawyers of Shivinder Singh, Godhwani and RHC could not be reached.
The case started as an investigation by the Economic Offences Wing of Delhi police that received a complaint from a RFL employee alleging that money was being funnelled by the Singhs.
RFL said in a press release that it is working to return to normalcy.
“All efforts continue to be made to rebuild the business, mobilise fresh capital and correct the transgression and legacy issues of the past. The management and internal controls at the group ... have also been revamped, bringing in much needed assurance to employees about a stable and action-oriented management,” it said.
The Singh brothers are both in jail. They have made attempts to resolve the case with the complainant, but made no progress. They also seem to have fallen out with Malvinder Singh alleging that Shivinder Singh transferred the money to an influential religious sect.
