Money laundering case: Fraud Office probes 17 firms who took loans to fund Vijay Mallya

Sources said that SFIO has asked the 17 companies to disclose the source of the funds given to Kingfisher.

Written by Khushboo Narayan | Mumbai | Updated: July 22, 2016 11:25 am
vijay-mallya-759 Kingfisher Airlines Chairman Vijay Mallya.

IN A new twist to the Kingfisher Airlines loan default case, the Serious Frauds Investigation Office (SFIO) has issued notices to 17 companies that lent money to the now-defunct airline after they themselves borrowed from banks, said sources familiar with the development.

“As a result, the exposure of these banks to Kingfisher is expected to go up,” sources told The Indian Express. Kingfisher owes Rs 9,091.4 crore, including interest, to 17 banks as on November 30, 2015, according to a statement made by Arun Jaitley in Parliament on Thursday.

Sources said that SFIO has asked the 17 companies to disclose the source of the funds given to Kingfisher. “These companies which are not Non Banking Finance Companies (NBFC) have borrowed money from the banks and lent to Kingfisher Airlines,” sources said.

A CBI official confirmed that the amount involved in the alleged fraud by Kingfisher and its promoter may increase. “The matter is under investigation. But the amount involved currently will go up,” said the CBI official.

The SFIO probe has allegedly found instances of “corporate misgovernance” at Kingfisher Airlines, said sources. “The SFIO probes 17 firms who took bank loans to fund Kingfisher agency is investigating movement of loan money from one company to another. The final investigation report is likely to be submitted in a month,” said sources.

An email sent to the official spokesperson of Mallya did not elicit any response.

So far, the SFIO has recorded the statements of over 30 officials in connection with the loan default by Kingfisher. Apart from questioning officials of public sector banks, the agency has also questioned the directors of Kingfisher Airlines and United Breweries (Holdings).

“The agency also recorded the statements of independent non-executive directors of United Spirits,” said sources.

On Friday, the SFIO recorded the statements of two senior officials of United Breweries (Holdings) in connection with the case. “The agency is all set to question Vijay Mallya by the end of this month for the third time. Mallya has assured that he will be present for questioning,” said official sources.

Mallya and his companies have come under the scanner of multiple investigative agencies in the country. The CBI is investigating Kingfisher for defaulting on a Rs 900-crore loan from IDBI Bank. The Enforcement Directorate has registered a case against Mallya for alleged money laundering.

Mallya is currently fighting at least 22 cases in various courts related to loan default by Kingfisher Airlines. At least three banks – United Bank of India, State Bank of India and Punjab National Bank — have declared Kingfisher Airlines, United Breweries (Holdings) and Mallya as “wilful defaulters”.

Mallya, however, has tweeted that he is not an absconder. “As an Indian MP I fully respect and will comply with the law of the land. Our judicial system is sound and respected. But no trial by media,” Mallya said in a tweet on Friday.

Read | Vijay Mallya clarifies: Did not flee from India, neither am I an absconder 

Keystrokes: Vijay Mallya

Read | No laxity on action against Mallya: SBI

Read | Vijay Mallya FERA case: After 17 years, final arguments to begin

Read | Mallya flew out of India on March 2, says A-G; SC issues notice on banks’ plea

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  1. H
    Harikrishnan
    Mar 12, 2016 at 7:13 am
    One by one, corruption during the congress rules is coming out. Mallya was elected to the Rajya Sabha in 2002 from his home state of Karnataka with the support of the Congress party and Janata Dal (Secular). Many of the media and their anchors also are recipients of the Congress largess e. No wonder all of them are on one side to bring the Modi government down at the earliest.
    Reply
    1. A
      ashok
      Mar 12, 2016 at 5:46 am
      Arrest the bank executives and the cmds who are involved in sanction of loans and size their property this will definitely bring a fear among the bankers that they cannot get away
      Reply
      1. D
        Daniel Alvin
        Mar 12, 2016 at 7:31 am
        Why now so many investigations when he is allowed to go away to another country . Typical case of Shut the stable door after the horse has bolted.
        Reply
        1. M
          madan gupta
          Mar 12, 2016 at 4:11 am
          लीडर, सीबीआई, बैंक सब मिले हुए हैं. यह जनता को दिखाने के लिए ड्रामा है. ऐसे बेईमान, चोर को संसद में किस ने भेजा, और अब उसे क्यों नहीं वहां से निकालते.
          Reply
          1. M
            M Vyas
            Mar 12, 2016 at 8:06 am
            Take actions against Yash Birla on whom ED issued look out warrants many months ago for money laundering..Why matter under carpet..Even SBI is not moving for default of loan repayment by company under his management.. Only action by SBI. is bank has taken the symbolic possessions of the ets of the group companies..These are not concrete actions and SBI not willing to move fast strongly to even change the current management to. realize loan given..
            Reply
            1. M
              mao tse
              Mar 12, 2016 at 7:49 am
              Actually Rahul hi has to explain to the nation how all this fraud took place during Congress rule
              Reply
              1. M
                monica
                Mar 12, 2016 at 10:19 am
                post my comment on these corrupt entrepreneurs who are cheating banks and enjoying luxuries at cost of tax payers money.now jaitely is under watch as what he does against these corrupt and dishonest businessmen and executives of the banks involved in sanctioning loans to these defaulters. must name other and all defaulter in the parliament.
                Reply
                1. N
                  NAGU
                  Mar 12, 2016 at 8:59 am
                  Dear Hari krishana, if you know the FACT , then comment otherwise plz keep Quite , there is a Political Party in Karnataka , started by EX- PM of India which supplies MP - Rajya sabha : charging Rs. 100 Crores to eligible Candidates like , MALYA ( KF), MAM Ramsamy(Horse owner ), R. Chandrasekar( BPL), Anil Ambani( RIL ), Venkayya Naidu ( Minister ) and Many others , I am wondering how CONGRESS comes to picture Naagu
                  Reply
                  1. H
                    heena
                    Mar 12, 2016 at 6:05 am
                    Not only bank employees, the politicians, agents, middlemen all shall be put behind bars and confiscate all their properties.
                    Reply
                    1. R
                      revant
                      Mar 12, 2016 at 3:24 am
                      OMG OMG oh my bad
                      Reply
                      1. S
                        seshadri
                        Mar 12, 2016 at 3:06 am
                        shameless fellow is now saying i am not absconding if he is honest he himself should surrender to the court he has fooled the banks and indina government if mr modi is honest he should contact pm of uk and get him arested come what may
                        Reply
                        1. S
                          seshadri
                          Mar 12, 2016 at 3:11 am
                          all are in hand and gloves public is being fooled
                          Reply
                          1. G
                            Ganesh
                            Mar 12, 2016 at 6:13 am
                            BJP no wonder is called the sponsor of Art of Leaving
                            Reply
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