Another banking scam hits Indian banking system as diamond company owned by Gujarati brothers defaults IDBI Bank with Rs. 6,710 crore, biggest since since Nirav Modi

In what looks like another massive banking scam, a diamond company owned by three Gujarati businessmen Kirtilal R. Sanghavi, Chandrakant R. Sanghavi and Rameshchandra R. Sanghavi allegedly defaulted on LIC-owned IDBI bank with a huge Rs. 6,710 crores. The latest default is described as the biggest since Gujarati businessmen Nirav Modi and Mehul Choksi defrauded the Punjab National Bank with Rs. 14,000 crore in loans. Both then fled India.

According to news agency IANS, the outstanding amount owed by Sanghavis includes a large foreign currency component of more than $161,000 or around Rs 1.20 crore.

The revelation comes at a time when government-owned company IDBI is busy preparing to launch its IPOs next year.

The company that defaulted on its loans is Sanghavi Exports International Pvt Ltd, with Sanghavis being their three prominent directors. Other major promoters, guarantors and directors named in Sanghavi Exports International Pvt Ltd and its associated companies are Kalpesh V. Sanghavi, Jayesh V. Sanghavi, Ketankumar V. Sanghavi, Virendrakumar K. Sanghavi, Aagam C. Sanghavi, Bharati V. Sanghavi, Nikita V. Sanghavi, Premila K. Sanghavi, Kalpana R. Sanghavi, Devika C. Sanghavi.

The company is headquartered in the posh Bandra Kurla complex in Mumbai.

Vishwas Utagi, the head of the All India Bank Officers’ Association, called the new revelations “truly staggering” and wondered how this scam had never been publicized for so long.

“However, with such mega-scams lurking in the ‘government-owned private bank’, who will now be held responsible for the losses – the Centre, the LIC or the IDBI bank officials – especially as the IPO of LIC is imminent,” Utagi was quoted by IANS.

About Ruben V. Albin

Check Also

COLUMBIA BANKING SYSTEM, INC. MANAGEMENT REPORT ON FINANCIAL POSITION AND RESULTS OF OPERATIONS (Form 10-Q)

This discussion should be read in conjunction with the unaudited Consolidated Financial Statements of Columbia …