dhfl case: DHFL scam: Promoters Wadhawans set up 87 shell companies, says CBI charge sheet

The Central Bureau of Investigation (CBI) has alleged that DHFL‘s promoters formed 87 shell companies, created more than 260,000 “fictitious borrowers” and set up a “virtual branch” to divert money borrowed from banks. In its charge sheet filed last month in connection with India’s biggest bank fraud, involving ₹34,614 crore, CBI stated that Kapil and Dheeraj Wadhawan diverted funds and purchased 24 paintings worth ₹63 crore.

Taking cognisance of the charge sheet, a special CBI court last week ordered that all 75 accused in the case be summoned. “Investigation at the overseas level has also to be conducted to trace the trail of funds of DHFL,” said the court order.

The charge sheet, a copy of which was seen by ET, said DHFL disbursed ₹11,765 crore to 87 shell companies between 2007 and 2017. It said the CBI investigation has revealed that the Wadhawans incorporated entities in the name of their employees, associates and friends.

Branch Code 001

They fraudulently and dishonestly used these entities as vehicles to divert funds availed from banks, from the accounts of DHFL to their own entities, said the charge sheet.

CBI said in the charge sheet that DHFL had many branches for loan disbursement and that for disbursement to these shell companies, the company created a specific code in the name of “Bandra branch.”

“DHFL promoters deliberately transferred the funds in these companies when required by them for any business or personal use,” said the charge sheet….