Former Yes Bank co-founder Rana Kapoor is facing fresh trouble after the Mumbai Police registered a new FIR against him, investor Sudhir Valia, and several unnamed bank officials in an alleged Rs 1,000 crore fraud case.
What is the Fraud about?
The case is related to alleged irregularities in loan assignment and the undervalued sale of mortgaged properties.
According to the complaint, Yes Bank had given a loan of Rs 150 crore in 2016 to Sapphire Land Development Pvt Ltd, a company linked to the HDIL group.
The bank transferred the loan recovery rights to Suraksha Asset Reconstruction Company (ARC) within 10 months, even though the repayment period was fixed at 36 months.
The complaint further claims that the loan was transferred without first declaring it a non-performing asset (NPA).
As per reports, the complaint was filed by Lakhminder Dayal Singh, who is a suspended director of Sapphire Land Development.
The complaint alleges that mortgaged properties worth nearly Rs 1,000 crore were undervalued and later sold at very low prices.
It also claims that the recovery rights were assigned below market value as part of a conspiracy.
Investigators are also examining allegations that Suraksha ARC received Rs 22.50 crore as margin money through internal accounts linked to the transaction.
Financial records reportedly show that Sapphire Land Development has a paid-up capital of only Rs 5 lakh and has not updated its balance sheet since 2018.
Its parent company, HDIL, has been undergoing insolvency proceedings since August 2019.
Rana Kapoor has already faced investigations by the Enforcement Directorate (ED) and the Central Bureau of Investigation (CBI) during the Yes Bank crisis.
Yes Bank Crisis and SBI’s Rescue Stake
Yes Bank faced a serious crisis in March 2020 after growing financial stress and concerns over its condition. On 5 March 2020, the Reserve Bank of India placed the bank under moratorium, and soon after, the reconstruction plan brought State Bank of India in as the main rescue investor.
- SBI was given a 49% stake in the reconstructed Yes Bank.
- The move was meant to restore confidence and protect depositors.
- This was one of the major banking rescue steps taken in India at that time.
The new FIR has once again raised questions about past loan and asset deals linked to Yes Bank.
