Investigation into Singh brothers and RSSB guru financial fraud saga continues

The Economic Times has a new story about the investigation into financial fraud involving the Singh brothers (Malvinder and Shivinder), Sunil Godhwani, Gurinder Singh Dhillon (guru of Radha Soami Satsang Beas), and others.

I've boldfaced some passages for emphasis. Basically the story shows that authorities in India are still engaged in finding out in whose hands the illegal money transfers ended up, and where the money is now. So the financial fraud saga continues...

 

NEW DELHI: The Enforcement Directorate (ED) is in the process of approaching foreign jurisdictions, to get details of more people and entities that may have involved in laundering money linked to the alleged Religare fraud.

In its charge sheet that accused former Religare promoters Malvinder and Shivinder Singh of money laundering, the agency said it is in the “process of issuing letters rogatory (LRs) to foreign jurisdictions”.

The agency also told a local court that of the total Rs 2,036.69 crore of estimated proceeds of crime, investigation over Rs 300 crores has been completed. “Investigation in respect of identification of remaining proceeds of crime and accused that are involved in money laundering is in progress,” it said in the charge sheet, which ET has seen.

The matter came up for resumed hearing on Wednesday when copies of the charge sheet were supplied to the accused.

On account of the ongoing legal battle between Malvinder and Shivinder Singh, a copy of the charge sheet could not be supplied to RHC Holding, a company privately owned by the brothers which is also an accused in the charge sheet. This is because there was no legal representative to appear for RHC Holding.

Special public prosecutor for the ED, Nitesh Rana, told the court that the brothers, along with co-accused Sunil Godhwani and others, are “involved in process of acquisition, layering, possession, concealment, use and projection of proceeds of crime generated out of criminal activities”.

Singh brothers and Godhwani had denied any wrongdoing.

Elaborating on the alleged role of the two brothers, the charge sheet said, “Malvinder and Shivinder Mohan Singh incorporated and used multiple conduit companies for the purpose of siphoning off public funds from Religare Finvest Limited (RFL) by way of sanctioning and disbursal of loans under corporate loan book (CLB)”.

It said the conduit companies were associated with the Singh brothers. This is “clearly established on the basis that the directors of the said companies have accepted that they were relatives or associates of the promoters (Singh brothers). And that properties owned by the conduit companies were being utilised for the benefit of the promoters as also the fact that some of these companies were purchased by the promoters in 2017-18,” the charge sheet said.

It alleged that the funds “siphoned off” by the brothers and Godhwani through “sanctioning, evergreening, layering of CLB loans were ultimately utilised for repaying existing liabilities” of the company of Singh brothers “or the acquisition of properties for the benefit of Malvinder and Shivinder Mohan Singh”.

The agency said it may file a supplementary charge sheet if its investigation in India as well as abroad ascertains involvement of more individuals involved in laundering and parking of proceeds of crime.

Underlining the role of RHC Holding, the agency said the company acquired Rs 150 crore of proceeds of crime and “utilised the said amount in repayment of its existing liability towards RFL by projecting it as untainted”. It added: “RHC group entities have not only been used as conduit companies but in some cases are the ultimate beneficiary of the proceeds of crime.”

Elaborating on the alleged modus operandi, the agency said proceeds of crime “through a complex maze of interconnected transactions” have been layered and “integrated in the main stream economy for evergreening of old loans”. The proceeds were also used for other purposes and for the acquisition of property, it claimed.

ET was the first to report on January 22 that the Economic Offences Wing of the Delhi Police, in its separate charge sheet, had alleged that the Singh brothers had “diverted public money from group entity Religare Finvest to shell companies and used it to square off their personal liabilities”.

Executives at Religare Finvest, the group’s lending arm, had approved unsecured loans worth hundreds of crores to the shell companies within two hours of getting the proposals, even when these companies themselves had not sought the loans, the EOW said. The Singh brothers had joined the board of Religare Finvest in 2016 with the intention of diverting money to these 19 shell companies, the EOW alleged.

Comments

[Sonia]

“The agency said it may file a supplementary charge sheet if its investigation in India as well as abroad ascertains involvement of more individuals involved in laundering and parking of proceeds of crime.“

Oh boy, GSD will be long gone before they ever wrap up this case. This investigation is going to go on for years.

[J]

Another disappointingly vague report from the Indian justice department.

The siphoned funds were used to pay off liabilities....to whom? To the corporation's creditors?

If a corporation owes money to creditors, then it pays them directly. What advantage is there in a complex scheme to set up shell companies with family members, essentially rob the corporation with bogus "loans" to these shell businesses, pay family members a salary for "running" these shell businesses and then taking what's left of the money and paying off the creditors? If the creditors were outside the corporate world, who were they? Dunkin Donuts or Dhillon family?

Then we're also told that the siphoned funds were used to buy properties. What properties, bought from whom, and why didn't the accused sell these properties in an effort to avoid going to prison? I guess this scandal could possibly have been a personal real estate scheme, but when will India's police just come out and say this is what happened?

"The agency also told a local court that of the total Rs 2,036.69 crore (291 million dollars) of estimated proceeds of crime, investigation over Rs 300 (43 million dollars) crores has been completed."

OK, so where is this property? Where-is-the-money? Come on India police.

[Baba Land Grab]

Police is only doing what they are being told to do by their paymaster politicians who set up this Dera to divide Sikhs in punjab and for politicians to launder their dodgy money to foreign countries through this Dera.Congress,BJP and Akali,s have all used this Dera to shift money abroad,surely they are not going to shoot themselves in the foot by arresting GSD .

If authorities wanted to arrest GSD there is more than enough evidence relating to illegal land grab and diversion of river Beas.Monetary value of land grab is much higher than the money laundering case.

[Sonia]

Posted by: J | January 31, 2020 at 12:04 PM

They’ve already listed some of the properties purchased—large commercial real estate buildings that are sitting empty and farmhouses (which seems to have a sort of different meaning in India).

A FOG said that GSD believed selling these buildings at a fraction of their cost in order to settle these debts didn’t make sense. He convinced Shivinder it would be better in the long run to continue bringing in some revenue in rent from these properties than to sell for pennies on the dollar. And poor Shivinder followed all of GSD’s advice on business matters right up until he got arrested. Unfortunately, that didn’t comply with Daiichi’s “long-term” plan.

Note to reader: taken from off the record sources with a tad bit of sarcasm thrown in.

[j]

"A FOG said that GSD believed selling these buildings at a fraction of their cost in order to settle these debts didn’t make sense."

But if the purchased properties belonged to Bros Singh et al, how was GSD's opinion relevant? Who owned this real estate, the Brothers or GSD, or Dhillon family members, or someone else?

I admit to frustration that after years of this brouhaha the Indian police still can't tell us the even the most basic facts of who owned what.

[Paan singh]

this is a setup.
the companies did not belong to the singh bros
if they did, the singh brothers would never have lost their fortune
they would have paid off Daiichi and that would have removed the freeze on their bank accounts.
the police are acting on instructions from polititians, blaming singh bros while GSD is not mentioned