Religare Enterprises former promoters Malvinder and Shivinder Mohan Singh used Religare Finvest's public money to “square off their personal liabilities”, said the Delhi Police’s Economic Offences Wing (EOW) in its charge sheet against the brothers, according to an Economic Times report.
“Malvinder and Shivinder used shell/dummy entities along with the management of REL (Religare Enterprises) and RFL to divert the money from REL to their holding company, by adopting circuitous transactions to conceal the fake transactions and to make them appear genuine,” the EOW told the daily.
When the EOW questioned the former Fortis Healthcare promoter Malvinder Singh, according to the report, he alleged that "Sunil Godhwani and his team at Religare managed and ran the affairs of RHC and its subsidiaries, decisions of money movement between REL, RFL, Babaji (Radha Soami Satsang chief Gurinder Singh) entities and RHC group entities".
Unsecured loans worth hundreds of crores were sanctioned to the shell companies by the executives of the group's lending section, within two hours of receiving the proposals, through a procedure that was stated to be just a “paper formality” in the charge sheet, the report said.
A "prominent feature” of the entire process was that these “shell/dummy companies” never made any request for loans, according to the charge sheet.
The “dummy” directors further claimed that they “signed the documents which were sent to their house through a messenger/employee of promoters at the year end and received salaries from the companies”, the EOW told ET.
Malvinder Singh had alleged that "Religare and its subsidiaries owe money to RHC Holdings and not the other way around. Fern Healthcare, Modland (that are described as shell companies by the EOW) owe money to RHC Holdings and its subsidiaries and were fraudulently made part of the RHC Group without any diligence, valuation or any board approval. This was done by Shivinder Singh to shield Babaji and his family members to personally owe over Rs 1,000 crore to these entities," according to ET.
The Singh brothers had joined the board of Religare Finvest in 2016 with the intention of diverting money to these 19 shell companies, the charge sheet said.