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ABU DHABI: The Abu Dhabi Global Market Court has held NMC Healthcare founder BR Shetty and former Chief Executive Officer Prasanth Manghat liable for fraudulent and wrongful trading in connection with the catastrophic collapse of the London-listed healthcare group in 2020. In a ruling delivered on November 5, 2026, the court determined that both individuals knowingly participated in a widespread scheme involving the systematic diversion of company assets, concealment of vast borrowings, and manipulation of balance sheets. Justice Sir Andrew Smith, presiding over the ADGM Court of First Instance, established 5.397 billion dollars, equivalent to approximately Rs 50,807 crore, as the base figure for determining the financial contributions the two executives must repay to the insolvent company’s estate. The court clarified that the final compensatory awards, accrued interest, and legal costs will be fixed during a separate follow-up hearing.
Extensive Fund Diversion Traced to Personal Accounts and Luxury Assets
The judgment documented the extensive siphoning of commercial capital into personal coffers over several years of the company’s public listing. Judicial scrutiny identified more than 500 individual financial transfers totalling roughly AED 4.18 billion, equivalent to about Rs 10,713 crore, deposited directly into personal bank accounts controlled by Shetty. Even after adjusting for funds remitted back into the business group, the net unexplained outflow amounted to approximately AED 2.6 billion, or nearly Rs 6,664 crore. The court heard that these company funds were deployed to finance lavish private expenditures, including the procurement of private aircraft, premium real estate acquisitions in Dubai Hills, and direct capital investments in an oil field situated in Wyoming, United States.
Billions in Undisclosed Debt Concealed Through Sham Supplier Invoices
The court identified deliberate and structured balance-sheet falsification that concealed the enterprise’s severe insolvency from regulators, auditors, and lenders. By December 2018, the healthcare provider had amassed nearly 3.88 billion dollars, roughly Rs 36,526 crore, in off-the-books liabilities, while declaring an official corporate debt of merely 1.99 billion dollars, or about Rs 18,734 crore. The court determined that the management maintained this deception by constructing elaborate supplier financing schemes. Under these arrangements, collaborating suppliers drew invoices for materials and services that were never intended to be delivered. Partner banks financed the fictitious paperwork, and the proceeds were subsequently redirected back into the corporate fold, enabling NMC Healthcare to secure illicit liquidity while misleading stakeholders.
Court Dismisses Executive Defences and Notes Settlement with Bank of Baroda
During the legal proceedings, the court firmly rejected the defensive arguments put forward by both Shetty and Manghat. Shetty claimed he was an unwitting victim deceived by dishonest subordinate executives, a plea the judge dismissed as entirely unsupported by the evidentiary record. Manghat contended that he held no operational control over group finances, a defence Justice Smith termed implausible for an individual serving as the chief executive of an enterprise listed on the FTSE 100. Holding that both executives knowingly engaged in fraudulent trading starting on April 30, 2012, the court declared them personally liable under the provisions of the ADGM Insolvency Regulations, 2022. Parallel claims raised by the administrators against Bank of Baroda and its former managing director, PS Jayakumar, alleging arrangements to withhold account details from external auditors, were formally discontinued after the financial institution reached a settlement agreement near the end of the trial, with the court issuing no adverse findings against them.
