Fourth FIR against Talwalkars for bank loan fraud

Talwalkars are accused of fraudulently securing a loan from the bank and utilising the funds for other purposes. The health club chain now faces criminal cases involving a total amount of ₹450 crore of defaulted loan

Mumbai: Mumbai Economic Offences Wing (EOW) of the Mumbai Police has registered a fourth First Information Report (FIR) against Talwalkars – India’s largest chain of gyms and health clubs – for allegedly defrauding Syrian Catholic Bank of ₹28.40 crore.

The EOW has already issued lookout circulars (LoCs) against the directors and other top executives of Talwalkars group. (Stock Pic)

Talwalkars are accused of fraudulently securing a loan from the bank and utilising the funds for other purposes. The health club chain now faces criminal cases involving a total amount of ₹450 crore of defaulted loan.

Banking-3 unit of the EOW has recently registered the FIR against directors of Aspire Fitness Private Limited, a subsidiary of Talwalkars group, directors of Talwalkars Health Club Private Limited and Chennai-based firms -- Gympac Fitness System Private Limited, Nitash Engineering and Consulting Private Limited.

The FIR is registered on the basis of a complaint by Rammohan Sharda, Fort branch manager of Syrian Catholic Bank. He alleged that Aspire Fitness Private Limited and Talwalkars Health Club Private Limited had in 2018 taken loan from them for opening 20 gyms in Mumbai, Nashik and Pune cities. For the gyms the two companies proposed to procure equipment from Gympac Fitness System, Chennai and another Chennai based firm Nitash Engineering and Consulting, which was to carry out the interior work.

After the accused firm sent Proforma Invoices, the bank sanctioned a total of ₹37.50 crore and transferred ₹28.40 crore to Gympac Fitness System and Nitash Engineering and Consulting.

In May 2019, when the complainant bank deposited a security cheque issued by the borrower company it was dishonoured as the signature on the cheque did not match with the signature in the payee bank’s record. The borrower company issued another cheque in August 2019. That too, dishonoured due to insufficient balance.

The bank then began a probe and discovered that Aspire Fitness had asked Gympac Fitness Systems to issue a Proforma Invoices worth ₹28 crore in the name of Aspire Fitness. And when the loan money got credited to the account of Gympac Fitness System, as per the instructions from Talwalkars, Gympac Fitness System transferred ₹20.76 crore to the account of Grow Fitter Private Limited, a company associated with Talwalkars group and ₹3 crore to Talwalkars group.

Grow Fitter later transferred the money to the Talwalkars group. Gympac Fitness System did not provide any gym equipment to Aspire Fitness. Similarly, funds received by Nitash Engineering and Consulting were also diverted to the Talwalkars.

As per the FIR (of which HT has a copy) Gympac Fitness System and Nitash Engineering and Consulting claimed that Aspire Fitness and Talwalkars submitted forged and bogus documents in the name of their companies to secure loans and later made them divert the funds in their accounts.

Director of the Grow Fitter too told the complainant bank that the accused directors of Aspire Fitness and Talwalkars under false pretexts made them transfer money to Talwalkars group, the complainant stated in the FIR.

Hence, the bank lodged a complaint also against directors of Aspire Fitness -- Girish Nayak and Virendra Shirlekar and directors of Talwalkars Health Clubs Pvt Ltd – Anant Gawande, Harsha Bhatkal, Prashant Talwalkar and Girish Talwalkar.

The EOW has already issued lookout circulars (LoCs) against the directors and other top executives of Talwalkars group.