Sterling Biotech Group: Is the ‘Generous’ Danny Patel of Sandesara Drive, Virginia, Managing Fugitive Sandesaras’ Vast US Assets?
A completely unconnected litigation in the United States has thrown up yet another money trail of the fugitive Sandesara family, the promoters of Sterling Biotech and Sterling SEZ, that owes Indian public sector banks (PSBs) vast sums of money. 
 
For those who have not followed this scandalous story, the Sandesaras (Nitin, Chetan and Dipti) are absconding and are believed to be holed up in Nigeria where they have extensive businesses. 
 
They have been accused of money laundering and have lookout notices issued against them by every national investigation agency –Central Bureau of Investigation (CBI), Enforcement Directorate (ED) and Serious Frauds Investigation Office (SFIO). 
 
And, yet, Indian PSBs are working with them to settle the massive outstanding dues of their group, of over Rs15,600 crore, at a 55% haircut through an emissary. The Sandesaras are also pushing banks to file litigation to buy time to make the payment. 
 
The US link emerged completely by chance while researching Danny Patel, whose name came up in investigation agencies’ findings with regard to their US operations. This, through some coincidences, led to an interesting litigation in New Jersey where Danny Patel, brother-in-law of Nitin Sandesara, plays an interesting role.  
 
It is something that our investigation agencies ought to be pursuing with speed. 
 
Sandesaras’ US Link
A lawsuit has been filed in New Jersey against two individuals - Anil Patel (of New Jersey) and Manish Patel (of Pennsylvania)–to recover US$13 million that they owe to a creditor named Lakhani Associates. This follows a long litigation that dates back to 2012. The two Patels claimed that they have no money or assets to pay up, following which the New Jersey Court appointed an official receiver to ensure compliance with its order. 
 
In the US, the receiver is a court-appointed officer vested with the power and responsibility to identify and collect assets in a pending suit. The details of the litigation are not important; but it leads a trail to Danny Patel’s door and also to a series of dubious transactions, benami deals and shell companies of the Patels who also may have a significant link to the Sandesaras. 
 
‘Generous’ Danny Patel 
In 2018, Anil and Manish Patel, who claimed that they were destitute, hired a new law firm to represent them in the lawsuit—it was the fifth law firm hired by them. This is where the story spices up. 
 
Since the Patels had no money, the receiver inquired about the source of their funds for their lawyer’s fees. Even the court found their claim to have no funds ‘incredible, implausible on its face, and without merit’.  
 
According to the court’s filings, the new law firm, Porzio, Bromberg & Newman, produced a ‘funding agreement’ under which Dakshay ‘Danny’ Patel of Virginia – the same Danny Patel who is Nitin Sandesara’s brother-in-law  – agreed to pay up to ‘$400,000’ for Anil and Manish Patel’s legal expenses, as a ‘generous friend’ and ‘out of friendship’. 
 
The receiver’s next set of findings are particularly interesting to those of us following the Sandesara story in India. 
 
Danny Patel is, apparently, a man of modest means who has no obvious ability to be so ‘generous’ in paying the legal expenses of the other two Patels.
 
Danny Patel has close ties to a number of US companies, affiliated with the Sandesara group, most of which are registered at a business address of – hold your breath –4595 Sandesara Drive, Prince George, VA. These include:
 
 
A website shows 34 different companies, many of them Sandesara affiliates, mentioned in the paragraph above (Sterling Gelatin America, SAIB LLC, Sun Management Systems, American Enterprises LLC), operating from that single address at 4595 Sandesara Drive, VA.
 
All this is excerpted from two New Jersey Court rulings – 29 October 2018 ruling – pp. 18-20; 2 April 2018 ruling - pp. 4-6; 4 September 2018 ruling - p.2. The receiver has found that the funds for Anil and Manish Patel’s expenses come from a bank account belonging not to Danny Patel, but a company called Virginia Star. (4 September 2018 ruling - pp. 7-8).Needless to say, Danny Patel has fought hard to prevent the receiver from ferreting out too much information about his finances, companies and sources of funds.
 
Indian investigators seem to be aware of some of the Sandesaras’ US businesses. Based on their findings, Firstpost had reported that Nitin and Chetan have floated 37 companies in the USA; some of these may have been used to funnel money to Nigeria. Is Virginia Star linked to the Sandesaras? Shouldn’t Indian agencies attempt to find out?
 
Here are some of the trails that lead to the Sandesaras.
 
1. SAIB LLC is shown as the owner of a Gulfstream 200 aircraft (https://prijet.com/owner/SAIB%20LLC) . This is the same aircraft (N162GB) that the Sandesaras owned and flaunted in India, with their name emblazoned on the aircraft that was allegedly seized by the ED and reported by Republic World. As noted above, the receiver has found that Danny Patel is an owner of SAIB. How does an asset belonging to Indian corporate group end up in the hands of a person living in Virginia, USA? Who paid for it?
 
 
 
2. In a hearing in the New Jersey Court, one of the lawyers from Porzio Bromberg, who was paid by Danny Patel, admitted that the payment came from Virginia Star. In one of the hearings, the lawyer stated that Nitin Sandesara has ‘been very generous’ to Anil and Manish and that they were relying on him for funds to satisfy the Lakhanis' judgement. (September 4 ruling - p. 11]. So, it seems that Porzio Bromberg and its clients, Anil and Manish, know Nitin Sandesara’s whereabouts and how to get hold of him.
 
3. As it turns out, our investigation agencies are aware of Danny Patel’s link to Nitin Sandesara and the fact that many of their assets are owned through him. In November 2018, The Economic Times reported that the Sandesaras owned 2.7 acres of land in Virginia through Danny Patel. This was based on information from our investigation agencies. The modus operandi of the fugitive Sandesaras is very similar to what the US court receiver says about Anil and Manish Patel’s use of shell companies and straw-men to conceal assets from their creditors in the USA. And, now, there seems to be a link between the two through Danny Patel’s payment of legal fees. Is this being investigated?
 
4. The US court orders detail many of the receiver’s findings concerning Manish Patel’s Indian operations and businesses, especially those that are similar to Sterling Biotech. One of these is Dinesh Remedies Ltd, based in Vadodara, and has connections to US-based Star Capsules and others. He is even supposed to have introduced the main litigant to Nitin and Chetan Sandesara and taken them on a plant visit to Gujarat. 
 
5. The ED has claimed to have attached properties worth over Rs14,000 crore belonging to the promoters of Sandesara group. Indeed, the details of fund diversion from India, to build a huge business in Nigeria, have been detailed by Firstpost already. 
 
Why is there no attempt to stitch together a big picture and ensure that Indian banks get 100% of the money owed by the fugitive Sandesaras and why are they settling for 45%. 
 
Why are the agencies and the government silent while a consortium of banks, led by Andhra Bank and State Bank of India (SBI), negotiates a shady deal with wilful defaulters on their terms? 
 
Remember, every Indian is paying for these bad loans in the form of several lakh crore rupees infused into bank recapitalisation in the past three years. Interestingly, no political party seems to be pushing for repayment and disclosure either. 
 
End Note: The documents mentioned above can be found by clicking and entering requisite details. 
 
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    COMMENTS

    Rajneesh Agarwal

    1 month ago

    Amazing work....

    Sudhir Mankodi

    1 month ago

    Indian banks who are negotiating settlement must pay heed to your article and renegotiate the settlement. Haircut can be accepted provided some hair are left on the scalp. Indian banks\' scalp is already bald and without hair! Where is the scope of any haircut with them?!

    tanay

    1 month ago

    Even a small website like yours can extract such info, its laughable that all the big investigation agencies cannot act on these already known money laundering proofs.....and here we are forced to pay tax each month to fund the legal fees of bankrupt Patels

    Ramesh Poapt

    1 month ago

    crooks are smarter than law.

    Prasanna

    1 month ago

    We should create a competent commercial - legal - forensic task force whose only work should be to recover the dues of our Banks from scoundrels who have looted the country's banks. Is it too much to ask for?? Why has this not been done till now? Inter-agency rivalries and vested interests come in the way of recovery. The task force could be a way out which will over ride all these.

    IL&FS Scam: ED raids at 12 locations in Chhattisgarh, MP
    Tightening its noose in the IL&FS (Infrastructure Leasing and Financial Services) case, the Enforcement Directorate (ED) on Wednesday carried out searches at over 12 locations in Madhya Pradesh and Chhattisgarh.
     
    A senior ED official said that the central financial probe agency was carrying out searches at 12 locations in Madhya Pradesh and Chhattisgarh on the premises linked to the defaulter company.
     
    The official said that the defaulter company received amount to the tune of Rs 111.29 crore in its bank account.
     
    The official, however, refused to share the names of the people whose premises were raided.
     
    The ED had registered a case of money laundering under various sections of the Prevention of Money Laundering Act on the basis of a case filed by the Delhi Police's Economic Offence Wing (EOW) in February this year.
     
    The Delhi Police had filed a case under several sections of the Indian Penal Code for criminal conspiracy and forgery on the complaint of Ashish Begwani, Director of New Delhi-based Enso Infrastructures.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
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    DoT cracks whip, tells telcos to pay pending AGR dues fast
    The Department of Telecom (DoT) has asked telecom licencees to speed up the process of self-assessment of adjusted gross revenue (AGR) based dues and the payment of over Rs 1.47 lakh crore and submit comprehensive representation on previous issued demands latest by December 13, 2019.
     
    The letter issued by the DoT has been viewed by IANS. The deadline for payment of AGR dues is January 23, 2020.
     
    Three telcos -- Airtel, Vodafone Idea and Tata Tele -- have filed review petition of the Supreme Court order in October, which paved the way for the DoT to seek AGR dues, penalty and interest from the telcos. 
     
    "The comprehensive representation shall be submitted within a week latest by December 13, 2019," DoT said in the letter to the telecom licensees, adding that majority of the licence fee assessments have been settled after the SC judgement and for any remaining issues, a comprehensive representation needs to be submitted to the department. 
     
    In light of the Supreme Court order on AGR computation, all the annual assessment for licence fees and spectrum usage charges for relevant years are being re-examined. 
     
    "And now since all the earlier demands are being re-examined with respect to the SC judgement, you are requested to kindly submit a comprehensive year-wise, circle-wise representation except for issues which have been decided by the SC," the letter said.
     
    "In this regard, it is pointed out that over a course of time, multiple representations related to LF (licence fee) assessments were received from various licencees for consideration by the department," the DoT letter added.
     
    Further, self-assessment of dues and payments along with the submission of relevant documents as per a licence finance wing letter of November 13 needs to be expedited, the letter said.
     
    Any issues should be pointed out in the comprehensive representation to be submitted but in no case the self assessment of the dues and payments along with the submission of relevant documents are to be delayed, it pointed out.
     
    The Supreme Court decided in favour of the government's contention that all revenues, including that from non-core sources, would be counted in calculating AGR. Licence holders have to pay about 8 per cent of AGR to the DoT as fees. Telcos also pay about 3-4 per cent of AGR as spectrum usage charges.
     
    Disclaimer: Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
     
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