Dubai: India’s banks – and the country’s legal system – will decide whether Dr. B.R. Shetty will make an “imminent” trip to the UAE to try and clear his name in the NMC corporate fraud case. Multiple sources confirm that the billionaire – who founded NMC and UAE Exchange Centre – had to drop his plans to travel to the UAE after a ban was placed on his exit from India.
This has not been officially confirmed by Shetty or his family. Gulf News reached out to Bank of Baroda, the Indian bank that had filed for action against Shetty, for clarification on the issue, but no details were provided. It is not known if the ban is a prelude to more action being taken against the former billionaire.
In the UAE, Shetty and former senior executives at NMC and UAE Exchange Centre are facing probes on bank funds that went missing from the company books. These could be in the range of $4 billion to $7 billion, and relate to diversions that started as early as in 2012, which was when NMC was listed on London Stock Exchange.
A court in India had recently issued orders freezing all assets of Shetty in India. (A similar move was made by the DIFC Courts on claims filed by other banks with exposures to the Shetty businesses.)
“In such a situation, it would be highly unlikely that the Indian authorities would allow Shetty to leave the country,” said a banker. “Plus, there is the shadow of the Vijay Mallya and Nirav Modi issues hanging over the Indian banking sector – in these circumstances, it would be hugely difficult for Shetty to make travel plans.”
India's government had faced heavy flak in political circles over Mallya and Nirav Modi's easy departures, and along with them billions of dollars in bank funds. India's banking sector still hadn't recovered from these mishaps when the pandemic dealt another bow.
Legal sources say that Shetty will need to put his house in order in India first to get over any travel ban that’s been imposed. Plus, in the UAE, much progress has been made in scripting a new future for NMC – without Shetty’s involvement. Much the same is happening at UAE Exchange Centre and its parent company Finablr, which is heading for a takeover by an Israeli firm, Prism Advance Solutions.
“The corporate turnaround at NMC is already bearing results – Shetty’s “help” will only be needed on the investigations into the $4 billion plus fund diversions,” said a banker. “His immediate priority will be on UAE Exchange Centre and Finablr. That’s where a lot of his "personal" stakes are still quite high.”
It was on Saturday evening that Shetty issued a statement talking about an “imminent” arrival in the UAE to co-operate with the authorities on the NMC and UAE Exchange Centre investigations. But a media report says that Shetty was stopped from boarding a flight to the UAE in the early hours of Saturday itself.
Banking industry sources say there is something jarring about this sequence of events.
“How can Shetty talk about making an imminent trip to the UAE - after being stopped at the airport?” asks the banker. “It was clear early Saturday itself that a travel ban is in place and imposed by the Indian Government. Unless, the Indian authorities say otherwise, the ban will remain.
“Shetty will have to put on hold all travel plans. More important - when did the Indian authorities issue a ban on him?”
It's now for the authorities - and banks - in India to decide the next chapter in the ongoing Shetty saga, which will mark its first anniversary next month. It was in December last year that Muddy Waters, a US consultancy, first came out with a report that said it was not all hunky-dory at the UAE's largest private healthcare operator NMC. That report eventually led to investigations and which revealed the missing billions...
There is the shadow of the Vijay Mallya and Nirav Modi issues hanging over the Indian banking sector – in these circumstances, it would be hugely difficult for Shetty to make travel plans