I'm sure defenders of the guru of Radha Soami Satsang Beas will have a different take on today's news from the Indian financial press, but the way it looks to me, Gurinder Singh Dhillon, his family, and associates are going to have to account for the hundreds of millions of dollars they've gotten from fraudulent loans.
Well, more than account. Because it sure seems like there's going to be a lot of pressure on the Dhillons, et.al., to pay back the approximate US $800 million they've gotten from highly suspicious loans.
No, that isn't a typo. The amount reported by Live Mint was $782 million. With interest and/or penalties, $800 million is a wholly believable figure.
So let's see why I believe the RSSB guru and others are going to have to come up with that money, much or most of which appears to have been spent on real estate deals, during the next few months.
First piece of evidence: A News18 story, "Since You Aren't a Sadhu Anymore, Start Thinking About Money, SC Tells Former Fortis Promoter." SC refers to the India Supreme Court.
New Delhi: The Supreme Court on Thursday told former promoter of Fortis Shivinder Singh that since he is no more a sadhu, he should start thinking about the money.
Shivinder and his elder brother Malvinder Singh had been called upon by a bench headed by Chief Justice of India Ranjan Gogoi in connection with a contempt plea moved by Daiichi Sankyo.
Daiichi has come to the court for securing Rs 4,000 crore of foreign arbitration award in the their favour and had got the stake sale of Fortis Hospital to IHH Healthcare Berhad, Malaysia stopped by way of an interim order of the apex court.
When the sparring brothers showed up on Thursday, senior lawyer Fali S Nariman, representing Daiichi, pointed out that while Malvinder claims is trying to pay off all debts, Shivinder says he has become a sadhu.
Interacting with Shivinder, CJI Gogoi said: "You are telling us that you have nothing to do with business anymore and that your brother is looking after it since you have renounced the world. If you have a debt to pay, your renouncing the world wouldn't matter to us." At this, Shivinder's lawyer PS Patwalia submitted: "Mr Shivinder has come back to the world in December 2017."
"Oh! That's good. Now that your lawyer says you've come back to the world, start thinking about money," retorted the CJI.
The court, then referring to the foreign tribunal award in the favour of Daiichi, told Singh brothers: "It is not just about Rs 4000 Crore or individual honour It is a question of honour for the country. It doesn't do good for the country. You were once the flag- bearers of this country. Pay your debts and come out of this."
It asked Malvinder and Shivinder to sit with their accountants and figure out a way to pay off their debts and honour their commitments. "We believe this was your first time in the court. Let your next appearance be your last. Come back with a plan," CJI told Singh brothers, adjourning the case to March 28.
How much is 4000 crore rupees? About $578 million. Do Malvinder and Shivinder Singh have anywhere near that much money? Almost certainly not.
There have been articles in the Indian financial press about the fall of their business empire. For example, a Forbes story, "How to Lose a $2 Billion Family Inheritance: The Tale of the Singh Brothers of India." Excerpt:
The Singh brothers were heirs to Ranbaxy Laboratories, which was then India’s foremost pharmaceutical company, founded by their grandfather Bhai Mohan Singh and stewarded by their father, Dr. Parvinder Singh, who died in 1999. The brothers, who each inherited one-third of the company, engineered its sale in 2008.
They also loaned vast amounts of money to companies owned by a family headed by a spiritual leader whom they followed and who was a relative of theirs — Gurinder Singh Dhillon. Dhillon was a businessman as well, and he and members of his sect were central to investments made with loans from the brothers, including investments in a wide-ranging real-estate portfolio.
A Live Mint graphic that I've shared in other blog posts illustrates how massive the "vast amounts of money" loaned to the Dhillon family was.
NEXT DAY UPDATE: A Live Mint story about the Supreme Court hearing reports that Malvinder Singh says the RSSB guru has loans of over ₹6,000 crore, $870 million, that are due. So the graphic above appears to be correct. Excerpt:
Malvinder Singh, in his 30-page affidavit, claimed that Gurinder Singh Dhillon, the spiritual head of Radha Soami Satsang Beas, his family members and companies controlled by him used funds from the Ranbaxy sale to buy real estate, and loans and advances of over ₹6,000 crore made to them were due. Malvinder claimed that though he made all efforts to sell his assets, these were thwarted by Daiichi Sankyo.
So where do the Singh brothers need to go to come up with the $578 million the Supreme Court of India says they need to pay Daiichi? It sure seems like the money they loaned to Gurinder Singh Dhillon and his family is a likely source.
Second piece of evidence: a Business Today story, "SEBI directs RFL, REL to recall loans worth over Rs. 2,300 crore from Singh brothers, others."
SEBI Thursday ordered Religare Finvest and Religare Enterprises to recall loans worth over Rs 2,300 crore that were diverted to promoters Shivinder Mohan Singh, Malvinder Mohan Singh and 21 other entities after finding preliminary evidence of fund diversions.
Religare Finvest Ltd (RFL) is a subsidiary of Religare Enterprises Ltd (REL). At the end of December 2018, the Singh brothers were among the promoters of REL.
"It was observed that funds amounting to Rs 2,315.09 crore had been diverted from the books of RFL for the utilisation of promoters and promoter group entities of REL," the regulator said in an order.
Noting that a detailed investigation of the fund diversion is necessary to find out the role of each entity in the alleged routing of funds, SEBI said remedial action needs to be taken to protect the interest of shareholders.
...The regulator has directed the two companies to "initiate steps to recall all the loans amounting to Rs 2,315.09 crore" along with due interest within three months.
...Apart from the Singh brothers, the loans have to be recalled from 21 other entities. Those include OSPL Infradeal, Bharat Road Network, Platinum Infrastructure, Ad Advertising and Artifice Properties.
The other entities are Best Health Management, Devera Developers, Vitoba Realtors, Fern Healthcare, Modland Wears, Rosestar Marketing, Star Artworks, Tripoli Investment & Trading Co, Volga Management and Consultancy, Zolton Properties, Religare Comtrade, RHC Holding, Ranchem, ANR Securities, Shivi Holdings and Malav Holdings.
The markets regulator had received complaints of alleged financial mismanagement and fund diversions at Religare Finvest for the benefit of promoter group entities of Religare Enterprises.
I've boldfaced the names of three companies SEBI [Securities and Exchange Board of India] is requiring loans to be recalled from that are companies Gurinder Singh Dhillon and his family got money from, as shown in the graphic above.
If the Live Mint graphic is correct, the RSSB guru and his relatives could be required by SEBI to pay back 5,992 crore, or $792 million. That's a heck of a lot of money. I doubt Gurinder Singh Dhillon has it in his checking account.
So it's going to be an interesting few months. The SEBI order speaks of 2,315 crore being recalled from loans made by the two companies, Religare Finvest and Religare Enterprises. It's unclear whether the loans made by 21 other entities are included in that amount.
I've assumed they aren't, but I could be wrong. Regardless, it appears that the Supreme Court ruling and the SEBI order mean that the RSSB guru, his family, and associates are going to have to account for the vast amounts of money they got from allegedly fraudulent loans.