The Serious Fraud Investigation Office (SFIO) is probing Religare Enterprises and its group company Fortis Healthcare for alleged frauds, Union Minister P P Chaudhary said Friday. Besides, companies linked to Nirav Modi and Mehul Choksi groups are under the scanner too, the minister of state for corporate affairs said in a written reply to Lok Sabha. The development comes in the wake of over Rs 13,000 crore scam at the state-run Punjab National Bank (PNB).
In the last four financial years, the corporate affairs ministry has ordered investigations through SFIO into the affairs of 575 companies on account of alleged frauds. This included probe in 258 companies in the ongoing financial year (till March 15, 2018), Chaudhary added. SFIO, which mainly investigates white collar crimes, is probing Religare and Fortis. This comes amid recent reports that financial irregularities have emerged at the two companies. With regard to Fortis, Chaudhary, in a separate reply said all the issues in their entirety will be examined by SFIO. “The investigation is presently in initial stage,” he added. These two companies have also come under the lens of the markets regulator Sebi.
The latest development comes against the backdrop of reports that Fortis Healthcare’s promoters -Malvinder Singh and Shivinder Singh- took at least USD 78 million out of the company without any board approval about a year ago. Further, Chaudhary said SFIO has ordered investigation into the affairs of companies including Firestar Diamond International, Firestar International, Firestar Diamond Pvt Ltd, Nirav Modi Pvt Ltd, Gitanjali Gems Ltd and Nakshatra Brands Ltd.
A multi-agency probe is already underway into the PNB fraud which was mainly perpetrated by way of fraudulent Letters of Undertaking (LoUs). According to the minister, investigations by SFIO have not unearthed any nexus between bureaucrats and corporate houses for the purpose of committing corporate frauds as of now.