Subramanian Swamy, leader of the Bharatiya Janata Party (BJP), has publicly released a letter he had sent a month ago (28 June 2019) to the prime minister (PM) Narendra Modi which accuses the Indiabulls group of embezzling Rs1 lakh crore from the National Housing Bank (NHB).
In the letter Mr Swamy stated that, “As per credible information that I have, and after perusal of many available documents, I wish to inform you that India Bulls Housing Finance Limited and its associates which many Congress leaders e.g., P Chidambaram and BS Hooda have patronised, is heading now for a financial collapse and bankruptcy, resulting large corruption issues in real estate sector, banking, stock markets and loss of more than Rs. One lakh crores of funds of public and of National Housing Bank.”
“India Bulls Housing Finance Limited and its related firms formed more than 100s of shell real estate firms to take loans from NHB and re-allot or siphon it off to many real estate firms in Maharashtra, Delhi, Gurugram, Bangalore and Chennai in the range of Rs.30 crores to Rs.1000 crores. After allotting these loans to other friendly real estate firms India Bulls accepted these amounts back as an investment to them! Some of such dubious loans were just book entries. That is, nothing but money laundering and round-tripping,” Mr Swamy stated in his letter to PM Modi.
Mr Swamy has also urged the PM to form a special investigation team (SIT) of the Central Bureau of Investigation (CBI), Enforcement Directorate (ED), Serious Frauds Investigation Office (SFIO) and Income-tax (I-T) officials to probe into the 14-year-old long money laundering of the group by siphoning the funds of the NHB.
In response to the circulating letter on social media, the Indiabulls group used the stock exchange portal to address and clarify the situation. The group said:
1. Loans outstanding as on date from NHB to Indiabulls Housing is zero.
2. Indiabulls Housing, in its history, has never taken any loan or refinancing facility from NHB.
3. The total loan book of Indiabulls Housing is approx. Rs87,000 crore.
Further, in a chat with CNBC TV-18, the vice-chairman and managing director of Indiabulls Housing Finance, Gagan Banga, said, "What the NHB can do is to provide refinance to housing finance companies (HFCs). NHB does not lend to companies in general. So the only entity that could have possibly sought refinance as an HFC is Indiabulls Housing Finance.”
This was a case of bizarre misinformation as in its existence of 14 years as a housing finance company, Indiabulls Housing Finance has never taken any refinance from NHB, noted Mr Banga. "This misinformation is being spread over the last two-three months ever since we proposed a merger with (Lashmi Vilas) bank,” he added.
“Even though we have already submitted ourselves to a very delicate due diligence process where we have already submitted all of our books to the regulators, this kind of misinformation keeps coming around. It is bizarre. I could not have embezzled more than the loans outstanding. If I have not taken a facility ever, how could I have done anything wrong with it,” said Mr Banga.
“We have also put out the link to the refinancing part of the portal of the NHB. It is very clear that the NHB refinances HFCs or banks and how they do it, what is the procedure and process, all that is detailed there. That shell companies can potentially borrow from the NHB is beyond my imagination. There is no procedure and process around that. It has never been done and it is quite crystal clear,” he further mentioned.
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Does it mean there were no allegations against the Company before 2-3 months?
If RBI permits the merger - does it mean the Depositors money is in safe hands?
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Need guidance as I am an existing deposit holder.
I can give you 1000 examples like this which happened to INDIABULLS HOUSING FINANCE today but where is the LAW and what SEBI is doing?
I have worked in BANKING &FINANCE sector for 25 years and in the recent developments like this SFIO published an article stating there are 2,27,000 + shell companies in india and they are unable to get the whereabouts of those companies. I proposed them ro appoint people like me who can support there investigation but no reply as off today. MAKES ME WONDER.
If i get an opportunity to serve for our investors benefit i would be much obliged to help them to get the details with interest of justice.
I HOPE SEEING TO MY ARTICLE ATLEAST SFIO SHOULD RESPONSE. I REQUEST Mr SWAMY TO THINK ABOUT MY PROPOSAL.
Regards
Prashanth
people as well the most)