This accusation has been made before by attorneys for Malvinder Singh, and it was made again last Tuesday, November 26. Here's a LiveMint story about the latest turn of events in the ongoing saga of how a guru, Gurinder Singh Dhillon, appears to be deeply involved in financial fraud.
I'll comment on this development following the story.
NEW DELHI : Delhi High court on Tuesday heard arguments on Enforcement Directorate’s plea for custodial interrogation of former promoter of Fortis Healthcare Malvinder Singh and former Managing Director of Religare Enterprises Sunil Godhwani in a money-laundering case related to alleged misappropriation of funds of Religare Finvest Limited (RFL).
Advocate Ramesh Gupta appearing for the respondents said the agency is not honest with their investigation.
“They have searched and seized the documents. I have joined the investigation whenever they asked of me. They are not touching the baba with whom 2000 crore is already there. They just want my confession. They want to know where the money is parked. I have nothing to do with those companies." He argued.
“They have arrested me only. They did not arrest the other accused. They want to shield Gurinder Singh Dhillon." He further added.
On the other hand, it was argued by standing counsel Amit Mahajan that there are 22 companies where 2300 crore has been transferred and there is an enormous material which needs to be confronted with the accused.
“I am trying to unearth the crime and trace the proceeds." He said.
The court will now hear further arguments on Wednesday.
The ED had arrested Singh and Godhwani on 14 November, following which their custody with the ED was extended twice. On 23 November, a Saket court rejected the ED's plea for extension of custody and remanded the two to judicial custody till 7 December.
ED had moved the Delhi high court against the trial court’s order.
Singh and Godhwani are accused of laundering money, punishable under sections 3 and 4 of the Prevention of Money Laundering Act (PMLA).
In December, Religare Enterprises and its subsidiary filed a complaint with the corporate affairs ministry alleging misappropriation of funds worth ₹2,230 crore of the company and its units.
The complaint also alleged that illegal issuances and redemption of preference shares led to undue gains of approximately ₹290 crore to promoter groups.
OK, it's good that the counsel for the Enforcement Directorate, which I've been told is sort of a cross between the FBI and CIA agencies in the United States, is trying to "unearth the crime and trace the proceeds."
What's puzzling is why it is taking so long.
After all, follow the money is a given in financial fraud crimes. It's extremely difficult to believe that Malvinder Singh and Sunil Godhwani broke laws and engaged in a complicated scheme of round-trip loans going to shell companies without the cooperation, if not the connivance, of those who ultimately ended up with the money and controlled the shell companies at one time.
This isn't akin to someone robbing a bank and then giving the money away to a relative without that person knowing where the money came from. It's akin to someone robbing a bank with the assistance of someone who worked at the bank, with that employee than ending up with the money.
Malvinder and his attorney are asking a good question: why aren't the authorities focusing more on the people who were the ultimate beneficiaries of the money that was siphoned from Fortis and Religare?
This appears to be Gurinder Singh Dhillon, his family, and close associates.
Numerous stories in the Indian financial press have traced the flow of money into their pockets. And the High Court of Delhi has ordered the Dhillon family to repay money owed to Malvinder and companies once controlled by the Singh brothers so a $500 million settlement can be paid to Daiichi Sankyo.
Maybe the wheels of Indian justice are turning slowly, but in the right direction.
However, there's reason for concern that because the Dhillon family has friends in high places, and the millions of followers of the RSSB guru include some fanatical people who would do anything for the guru, possibly including committing violence in his name, there's been pressure on the Enforcement Directorate to go easy on Gurinder Singh Dhillon.
Hopefully that isn't happening. Or if it is happening, it won't succeed.
This is a high profile case that has gotten worldwide attention. It would make India look bad if a guru was allowed to make off with hundreds of millions of dollars without legal consequences. This would send a bad message to companies thinking of investing in India. And it would leave the boards of Fortis, Religare, and Daiichi Sankyo justifiably enraged.
I'll end by citing a June 2019 post, "RSSB guru identified as beneficiary of fraudulent funds," where I quoted from a Business Today story that described filmmaker Sheetal Talwar's accusations that closely mirrored those just made by Malvinder's attorney. Here's some excerpts.
NRI film producer Sheetal Vinod Talwar has submitted to Sebi that Radha Soami Satsang chief Gurinder Singh Dhillon and his family allegedly benefited the most from Religare's Rs 2,300 crore fund diversion. Sebi's forensic audit via probe agency MSA Probe Consulting had identified diversion worth Rs 2,315.09 crore.
...Talwar has told Sebi that even though its Religare investigation via forensic audit firm MSA concluded fund diversion and large scale irregularities and illegalities, the probe did not lift the corporate veil to disclose the ultimate beneficiaries of the diversion.
Advocates & Solicitors Kartikeya & Associates-representing Talwar-have submitted to Sebi on 29 May, 2019 that, "...the persons who have benefitted the most and/or on whose instance the said illegalities and irregularities were and/or have been committed have yet not been identified. Please note that the persons and/or the shadow promoters of REL, RFL and their other group companies is one Gurinder Singh Dhillon (GSD/Babaji) and his family".
...Talwar's complaint to Sebi has also levelled a grave charge of a serious conflict of interest among Religare's then board members. "...the fact that the companies shared common directors to the GSD family as well as were all run by GSD followers eg.
Just a quick review would point to the fact that during the diversion of funds, Vitoba, Platinum and Devera entities to which fund were diverted would reveal that Yuvraj Narain Gorwaney alias Mithu is on the board of these companies-not only is Yuvraj...the secretary of RSSB, he also sits on the board of Logos Holding along with GSD and Shabnam Dhillon. Many such associations exist between the entities named and GSD family."