DHFL siphoned off Rs 31k cr, says Cobrapost

Non-profit web portal Cobrapost on Tuesday alleged promoters of Dewan Housing Finance Limited (DHFL) siphoned off more than Rs 31,000 crore of public money following which its shares plunged close to 11%.

“The scam has 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 have 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 UK, Dubai, Sri Lanka, and Mauritius,” the web portal alleged.

It said by lending to shell/pass-through companies without due diligence, DHFL has ensured that the recovery of such dubious loans was impossible since the companies or their directors themselves did not own any assets...

“This way the private assets acquired by the Wadhawans 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 Act or Insolvency and Bankruptcy Code of India,” it said adding, this way the only losers in the process would be the public sector banks, such as State Bank of India and Bank of Baroda, with an exposure of over Rs 11,000 crore and Rs 4,000 crore, respectively. Soon after the allegations, DHFL’s shares plunged but recovered by a small measure by the end of the day.

DHFL also issued a clarification saying DHFL and its group companies were confident of meeting any scrutiny on any aspect of operations and would pursue the frivolous allegations to their logical conclusion.

“Despite recent liquidity regime, DHFL as a responsible corporate has met all its obligations to the lenders and has paid back to them in excess of Rs 17,000 crore in the last three months. DHFL has a strong corporate governance regime and has received AAA credit rating from leading credit agencies. The company is fully tax-compliant and its books are audited by global auditors...”.