Rich-list Indian jailed in UK fraud
He was a god-fearing man who would hold pujas at his office every Diwali. Normally his prayers would be answered. On Friday, they weren’t.
Virendra Rastogi, 40, once listed as among the richest in Britain and lauded as a successful young entrepreneur, got a nine-and-a-half year jail term for one of the biggest and longest-running frauds in banking history.
The London court also awarded his two accomplices, Anand Jain and Gautam Majumdar, prison terms totaling 16 years, for the £350 million fraud that involved swindling money from banks in US and UK.
Rastogi’s plan was simple, which is why it went undetected for years. He built hype around his metal trading company RBG Resources by getting famous politicians as advisers, and running an empire of 324 fictitious firms with whom he would show he had cut deals. The address of one of the firms was later traced to a launderette, another to the home of a woman who sold scrapbooks, and the third to a cow shed in Moradabad.
What Rastogi would do is first take a loan from a bank in the name of RBG, which had claimed £1 billon turnover in 2001. To repay this loan, he would take a bigger loan from another bank and pocket the difference. During the trial at Southwark Crown Court, prosecutors said it was a fraud of massive proportions, which “raised deceit and misrepresentation to an art form”.
Luck ran out for Rastogi in 2002, a year after he was placed 207 in Sunday Times Rich List with £150m assets, when one of his employees by mistake sent fax to the wrong office. An employee at the Bucharest office of accountants PricewaterhouseCoopers, which was till then RBG’s auditor, received the fax and found that six different companies in Europe and Asia, had sent eight letters — all to RBG in London —from the same fax machine in Hong Kong.
This soon led to a raid at Rastogi’s place and six years of investigations.