BlackRock's private-credit investing arm and several major lenders are working to recover more than $500 million lost in an alleged loan fraud scheme they describe as "breathtaking" in scope, involving fabricated invoices and fictitious customer accounts, according to a report by the Wall Street Journal.
The lenders, including BlackRock's HPS Investment Partners, have filed suit against Bankim Brahmbhatt, the Indian-origin owner of telecom-services firms Broadband Telecom and Bridgevoice, according to the Wall Street Journal report.
The lawsuit, filed in August in the United States, accuses Brahmbhatt of creating fake invoices and accounts receivable that served as collateral for the substantial loans.
According to the legal complaint, Brahmbhatt's network of companies presented an illusion of financial health on paper while allegedly moving money offshore to India and Mauritius.
Scale of the fraud
The lenders' lawsuit claims Brahmbhatt's companies owe more than $500 million, the WSJ reported.
French multinational bank BNP Paribas helped finance the loans made by HPS to Brahmbhatt's entities, according to the report. The French bank, one of Europe's largest lenders, has declined to comment publicly on the case.
The alleged fraud surfaces at a delicate moment for BlackRock, which acquired HPS Investment Partners earlier this year as part of its expansion into private-credit markets. HPS began lending to Brahmbhatt-linked firms as early as September 2020, the report stated, later expanding the total investment from $385 million in 2021 to roughly $430 million by August 2024.
People familiar with the matter told the Wall Street Journal that BNP Paribas financed nearly half the amount loaned to Carriox Capital and its affiliates—companies within Brahmbhatt's telecom web.
When the loans were initiated, HPS hired Deloitte to verify Carriox's assets through random customer checks, and later brought in accounting firm CBIZ for annual audits, the WSJ reported. Neither firm has commented publicly.
Red flags emerge
Trouble surfaced in July 2025, when an HPS employee noticed irregularities in customer email addresses used to verify invoices, according to the WSJ report. Several of these addresses came from fake domains mimicking real telecom companies, and further investigation revealed that some correspondence supposedly from clients had been fabricated, the report claimed.
When questioned by HPS officials, Brahmbhatt reportedly dismissed the concerns and then stopped answering phone calls.
An HPS employee who later visited the Garden City, New York offices of Brahmbhatt's companies found the premises locked and deserted. The report stated that on Wednesday morning the office remained vacant, with nearby tenants confirming that no staff had been seen entering or leaving in recent weeks.
At Brahmbhatt's listed residence in Garden City, reporters noted two BMWs, a Porsche, a Tesla and an Audi parked in the driveway, alongside an unopened package collecting dust by the front door.
Investigation findings
Following the discovery of irregularities, HPS hired Quinn Emanuel, a prominent US law firm, and CBIZ to conduct a review. According to the Wall Street Journal, their investigation found that every customer email provided by Brahmbhatt's firms to verify invoices over the past two years was fraudulent, and that some contracts dating back to 2018 were forged.
A notable example cited by the report involved BICS, a Belgian telecom company. In July, a BICS security staffer confirmed in writing to Quinn Emanuel that the company had no connection to the emails shared by Brahmbhatt's firm, calling it a confirmed fraud attempt.
The lenders' complaint stated that Brahmbhatt created an elaborate balance sheet of assets that existed only on paper, and alleged that he had transferred assets to offshore accounts in India and Mauritius.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
