{"id":37,"date":"2018-03-14T01:29:17","date_gmt":"2018-03-14T01:29:17","guid":{"rendered":"https:\/\/populareducation.in\/loksamvad\/?post_type=article&p=37"},"modified":"2018-03-14T01:29:17","modified_gmt":"2018-03-14T01:29:17","slug":"a-warning-ignored","status":"publish","type":"article","link":"http:\/\/populareducation.in\/loksamvad\/article\/a-warning-ignored\/","title":{"rendered":"A warning ignored"},"content":{"rendered":"In hindsight, it seems like a scandal foretold. On July 26, 2016, an online complaint sent by the Bengaluru-based businessman Hari Prasad S.V. to the Prime Minister\u2019s Office (PMO) stated: \u201cI would like to bring to your notice a major financial scam similar to that of Mr Vijay Mallya of Kingfisher group from Bangalore, Subroto Roy of Sahara Group\u2014Calcutta or Ramalingaraju of Satyam Group\u2014Hyderabad. This scam and fraud [has been] done by [a] person\/company based in Mumbai involving loss of Rs.1000s of crores of Indian public money\u2026*sic+\u201d\r\n\r\nThis was not inflated talk. Claiming that the \u201cscam\u201d was still under way, the complainant proceeded to provide \u201cdetails of the fraudster\u201d and his purported financial dealings with some of India\u2019s biggest banks. The complaint claimed that the \u201cfraudster\u201d, Mehul C. Choksi, chairman and managing director of Gitanjali Gems Limited, had \u201csiphoned out thousands of crores out of India\u201d. The businessman appealed to the PMO to look into the financial dealings of the company \u201cand do *the+ needful before it is too late\u201d, that is, before Choksi \u201cescapes from the country like\u2026 Mr Vijay Mallya\u2026.\u201d\r\n\r\nChoksi is a business partner and maternal uncle of Nirav Modi, the diamantaire who grabbed national headlines after fraudulent transactions worth Rs.11,400 crore at Punjab National Bank became public knowledge in mid February. Inexplicably, popular attention towards Nirav Modi overshadowed the controversial business record of Choksi, who was at the centre of Hari Prasad\u2019s complaint. According to the Central Bureau of Investigation (CBI), the fraud by Nirav Modi\u2019s firms were worth over Rs.6,000 crore and that by Choksi\u2019s firms totalled Rs.4,886.72 crore. Clearly then, Choksi\u2019s alleged role in the scam is significant.\r\n\r\nHari Prasad told Frontline that he once enjoyed a good business relationship with Choksi. The ties soured after Choksi allegedly cheated him; he owes him Rs.13 crore. Hari Prasad said his concern was not purely personal. He was worried about the impact of Choksi\u2019s alleged fraud on the functioning of the banking system and the economy as a whole. That is the reason why he teamed up with other \u201cvictims of Gitanjali\u201d. He wrote the complaint after unsuccessful attempts at getting other institutions to act. It was also written on behalf of other victims. Hari Prasad made it clear that after having \u201cfailed to get the attention of any serious investigating authority, we have finally come to your door [PMO] for justice\u201d.\r\n\r\nIn what seemed like strong references to a select bunch of controversial rich Indian businessmen, Hari Prasad said he wished to save the country from \u201chuge losses of approximately Rs.10,000 crore looted by such white-collar thugs\u201d.\r\n\r\nHe described several aspects of the finances of Choksi\u2019s companies and pointed out the purported \u201cdeficiencies in the balance sheets\u201d. He presented a list of 31 banks that had extended loans to Choksi\u2019s group and warned that since multi-crore loans had been given despite the group having meagre assets, the loans were \u201cdefinitely going to become NPA *non- performing assets+ soon\u201d. The complaint also pointed to \u201ctax liabilities increasing year by year\u201d and warned that since the company was supposedly not paying tax dues, \u201cchances of him defaulting on payment are increasing by the year\u201d.\r\n\r\nClaiming that \u201chis *Choksi\u2019s+ tangible assets are very small\u201d, the complainant also called the balance sheet of Choksi\u2019s firm \u201cfictitious\u201d and assert ed that \u201cthere is something fishy with his company and its activities\u201d. Hari Prasad said \u201c(Choksi) could have managed the banks by some means\u201d.\r\n\r\nHari Prasad wrote: \u201cMost of the India subsidiaries are in losses and foreign subsidiaries in profit\u2026 Choksi has siphoned out Indian money abroad.\u201d Having made his case, he said: \u201cI hope you will take due note of the above and do your bit to save the country from another Subroto Roy (Sahara Group) and Vijay Mallya (Kingfisher Group) and may [prevent] such kind of white- collar thugs from looting public money and stashing it out of India. I hope you will do your best quickly to depute the right person to investigate this fraud and save the country from losing thousands of crores.\u201d\r\n\r\nThe PMO forwarded the complaint to the Registrar of Companies, which did not take any action.","protected":false},"excerpt":{"rendered":"

In hindsight, it seems like a scandal foretold. On July 26, 2016, an online complaint sent by the Bengaluru-based businessman Hari Prasad S.V. to the Prime Minister\u2019s Office (PMO) stated: \u201cI would like to bring to your notice a major…<\/p>\n","protected":false},"author":1,"featured_media":0,"menu_order":0,"comment_status":"closed","ping_status":"closed","template":"","format":"standard","meta":{"_uag_custom_page_level_css":"","_themeisle_gutenberg_block_has_review":false,"footnotes":""},"categories":[],"tags":[],"issuem_issue":[2],"class_list":["post-37","article","type-article","status-publish","format-standard","hentry","issuem_issue-march-2018","entry","no-media"],"yoast_head":"\nA warning ignored - Lok Samvad<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"http:\/\/populareducation.in\/loksamvad\/article\/a-warning-ignored\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"A warning ignored - Lok Samvad\" \/>\n<meta property=\"og:description\" content=\"In hindsight, it seems like a scandal foretold. 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