According to the Cobrapost expose, DHFL, which has a net worth of Rs 8,700 crore, raised Rs 96,000 crore through loans and public deposits.
Cobrapost said, “By lending to shell or pass-through companies
without due diligence, DHFL has ensured that the recovery of such dubious loans is impossible since the companies
or their directors themselves do not own any assets. This way the properties or private wealth acquired by the promoters and their associates by using the funds from these dubious loans are completely ring-fenced from any recovery process that may be initiated by authorities under the SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest) Act or Insolvency and Bankruptcy Code of India.”
Lenders, including public sector banks, have disbursed Rs 37,000 crore to the DHFL promoters, Cobrapost said, adding State Bank of India (SBI) had the highest exposure at Rs 11,500 crore, while Bank of Baroda has an exposure of Rs 4,000 crore in the group.
Cobrapost said its revelations were not based on whistle-blowers documents but a result of its research. The expose alleged the scam had been pulled off mainly by sanctioning and disbursing astronomical amounts in secured and unsecured loans to dubious shell/pass-through companies related to DHFL's own primary stakeholders Kapil Wadhawan, Aruna Wadhawan and Dheeraj Wadhawan through their proxies and associates, which had in turn passed the money on to companies controlled by the Wadhawans. “The money has been used to buy shares/equity and other private assets in India and abroad, including in countries like the UK, Dubai, Sri Lanka and Mauritius,” it said. Denying all the charges in an official statement, DHFL said the company was a publicly listed one and regulated by the National Housing Bank and the Securities and Exchange Board of India, among other regulators.
“This mischievous misadventure by Cobrapost appears to have been done with a mala fide intent to cause damage to the goodwill and reputation of DHFL and resulting in erosion in shareholder value,” the statement said, adding the company was a law-abiding corporate entity and all loans were disbursed in compliance with all regulatory norms. DHFL said it had a strong corporate governance regime and received the AAA credit rating from leading agencies. “The company is fully tax-compliant and its books are audited by global auditors,” it said. The NBFC further said as a responsible corporate, it met all obligations to the lenders and paid back more than Rs 17,000 crore in the last three months “despite the recent liquidity regime”.
The real intent of this exercise appears to be to destabilise the company, DHFL said.
DHFL diverted loans worth Rs 31,000 crore to create private wealth through a network of shell companies
Alleged scam pulled off by sanctioning and disbursing astronomical amounts in secured and unsecured loans to dubious firms related to DHFL's own primary stakeholders
Money used to buy shares/equity and other private assets in India and abroad