Top Ten Corporate Frauds in India That Cost Banks, Public and Investors Billions

1. Nirav Modi and Mehul Choksi (PNB Scam)

• Nature of Fraud: Fraudulent issuance of Letters of Undertaking (LoUs)
• Modus Operandi: Nirav Modi and Mehul Choksi allegedly colluded with bank officials to obtain LoUs without proper collateral. These LoUs were used to secure overseas credit, which was then siphoned off.
• Fraudulent Amount Involved: Approximately Rs 14,000 crores (USD 2 billion)
• Arrest: Nirav Modi was arrested in the UK in March 2019. Mehul Choksi was detained in Dominica in May 2021.
• Present Status of Case: Both are fighting extradition to India. Modi is in a UK prison; Choksi’s extradition process is ongoing.

2. Vijay Mallya (Kingfisher Airlines)

• Nature of Fraud: Financial mismanagement and LoanDefault
• Modus Operandi: Mallya allegedly obtained loans based on forged documents and personal guarantees, which were later defaulted on.
• Fraudulent Amount Involved: Over Rs 9,000 crores (USD 1.2 billion)
• Arrest: Mallya was arrested in the UK in April 2017 but is out on bail.
• Present Status of Case: He is fighting extradition to India. Multiple legal cases are ongoing in Indian courts.

3.Satyam Computers

• Nature of Fraud: Corporate accounting Scam
• Modus Operandi: Founder Ramalinga Raju inflated the company’s revenue, profit, and profit margins for several years by falsifying accounts.
• Fraudulent Amount Involved: Rs 7,800 crores (USD 1.1 billion)
• Arrest: Ramalinga Raju was arrested in January 2009.
• Present Status of Case: Raju was convicted and sentenced to seven years in prison in 2015. He was released on bail in 2018.

4.IL&FS (Infrastructure Leasing & Financial Services)

• Nature of Fraud: Financial mismanagement and fraud
• Modus Operandi: IL&FS allegedly inflated the value of its assets and underreported liabilities, leading to massive defaults.
• Fraudulent Amount Involved: Rs 91,000 crores (USD 12.7 billion)
• Arrest: Several senior executives have been arrested.
• Present Status of Case: Investigations and legal proceedings are ongoing. The government has taken control of the company.

5. Bhushan Steel

• Nature of Fraud: Bank fraud
• Modus Operandi: Bhushan Steel allegedly used forged documents to secure loans and defaulted on repayments.
• Fraudulent Amount Involved: Rs 56,000 crores (USD 7.8 billion)
• Arrest: Promoter Neeraj Singal was arrested in 2018.
• Present Status of Case: Legal proceedings are ongoing, and the company was acquired by Tata Steel in 2018.

6.Rotomac Pens

• Nature of Fraud: Loan default and money laundering
• Modus Operandi: The promoters allegedly used loans for purposes other than those specified, leading to defaults.
• Fraudulent Amount Involved: Rs 3,695 crores (USD 500 million)
• Arrest: Promoter Vikram Kothari was arrested in 2018.
• Present Status of Case: Legal proceedings are ongoing.

7. ABG Shipyard

• Nature of Fraud: Bank fraud
• Modus Operandi: The company allegedly used falsified documents to obtain loans and then siphoned off funds.
• Fraudulent Amount Involved: Rs 22,842 crores (USD 3.2 billion)
• Arrest: Promoters have been questioned; arrests may be pending.
• Present Status of Case: Investigation by the Central Bureau of Investigation (CBI) is ongoing.

8. Amrapali Group

• Nature of Fraud: Real estate fraud
• Modus Operandi: The company collected funds from homebuyers but diverted the money to other businesses, leaving projects incomplete.
• Fraudulent Amount Involved: Rs 3,000 crores (USD 400 million)
• Arrest: Promoters Anil Sharma and others were arrested in 2018.
• Present Status of Case: The Supreme Court of India is overseeing the completion of projects and refunding buyers.

9. DHFL (Dewan Housing Finance Corporation Ltd.)

• Nature of Fraud: Financial mismanagement and LoanDefault
• Modus Operandi: The promoters allegedly diverted funds obtained through loans to shell companies.
• Fraudulent Amount Involved: Rs 31,000 crores (USD 4.3 billion)
• Arrest: Promoters Kapil and Dheeraj Wadhawan were arrested in 2020.
• Present Status of Case: Legal proceedings are ongoing, and the company is under resolution.

10. Punjab and Maharashtra Cooperative (PMC) Bank

• Nature of Fraud: Bank fraud and financial mismanagement
• Modus Operandi: Bank officials allegedly created fictitious accounts to hide over ₹6,500 crores (USD 900 million) in loans made to the Housing Development and Infrastructure Limited (HDIL) group, which were not repaid.
• Fraudulent Amount Involved: Rs 6,500 crores (USD 900 million)
• Arrest: Several top officials, including the bank’s managing director and HDIL promoters, were arrested.
• Present Status of Case: Investigations and legal proceedings are ongoing. The bank is under the supervision of the Reserve Bank of India (RBI).

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