SFIO alleged that the IL&FS’s financial service subsidiary took loans from the lender by showing forged statements and credit ratings.
“In order to continue funding its group companies and prevent them from defaulting, and at the same time not to breach the RBI’s credit concentration norms, top management at IL&FS abused their positions, causing loss to its stakeholders” – report
- IL&FS alleged of ever-greened loans to avoid NPA classification and provisioning.
- Lenders were showed forged documents and false credit ratings.
- The Reserve Bank of India may look at cancelling the license of the non-banking finance company.
- SFIO is still looking into how credit rating firms gave high ratings of IFIN.
Officials also said it is just a tip of the iceberg in this massive fraud case, involving defaults of an estimated ₹90,000 crore, as the SFIO’s first charge sheet concerns just one entity, ILFS.
Future for IL&FS
The SFIO has charged ILFS with forming a “coterie” with its auditors and independent directors to defraud the company while running the business as their “personal fiefdom”.
Officials also said it is just a tip of the iceberg in this massive fraud case. It invovles defaults of an estimated ₹90,000 crore, as the SFIO’s first charge sheet concerns just one entity, ILFS.
The SFIO is also collecting details about all borrowings by IFIN from banks and through market instruments, as also about the role of banks and their officials and of credit rating agencies.