Exclusive Interview | Chanda Kochhar’s arrest only tip of iceberg, more beneficiaries involved, says whistle-blower Arvind Gupta

Finally, CBI has arrested the Kochhars and Venugopal Dhoot in the case first flagged by you…  

Lots of things are missing in this investigation. We have only picked up one small tip of the iceberg. The probe has not yet identified Chanda Kochhar’s coterie of officials. What has happened now is only an early and preliminary detention.

Could you elaborate a bit? 

I think CBI has gone ahead only to a limited extent with the probe even now. The real issue is ICICI Bank senior management coterie. Their role has not been probed in detail.

ICICI Bank board kept defending Chanda Kochhar, saying nothing is wrong and it was a credit risk management group and credit committee which approved the Videocon loan.  They said nothing is wrong (with Kochhar’s involvement) initially and all is well. ICICI board they are transparent in governance. It is only later they realised the facts of the case.

Kochhar wasn’t the only person in the credit committee… 

Yes. She has been saying she is not the only person. Mind you, this is very important. In the CBI FIR, they have named senior management officials. Even the CBI has said the role of these senior officials of the sanctioning committee needs to be investigated. That is yet to happen.

What are the questions before you at this point? 

They (the CBI) have, at max, gone to Videocon. The question is who all are the quid-pro-quo beneficiaries of ICICI Bank funding? Where are they? The key is Nupower. It was jointly formed with Deepak Kochhar and Dhoot. Why would a big corporate company form a JV with a banker’s husband? Entire JV was then handed over to Chanda Kochhar’s husband.

Do you think NuPower Renewables was a front company? 

Nupower was an SPV (special purpose vehicle) created to round-trip funds to India and, in the process, make Deepak Kochhar an industrialist.  Deepak Kochhar was not only hobnobbing with corporations, but also formed a nexus with bankers. He was hand in glove with the beneficiaries. I say NuPower was an SPV to round-trip money.

Dhoot has agreed to become an approver. 

It will open a Pandora’s box. This is just the beginning.  It may take another 5 or 10 years to bring the whole corporate-banking nexus fraud out in public.

Do you think there are larger implications to this case in the banking industry? 

I have been fighting corporate governance lapse cases involving corporations such as the most recent one involving Aksh Optifiber. There are no investigations on this case so far which is a big disappointment for me. About Rs 10 lakh crore to Rs 11 lakh crores bad loans have been written off in the last five years.

It is impacting the health of economy. You are allowing only crony promoters to prosper, looting public money through shady deals. This is just a first case. The whole thing is complicated. Unless promoters fall out of grace of the powers that be, nothing will happen.

Should there be a judicial level probe in the ICICI Bank-Videocon case? 

I don’t think a judicial probe will help. The probe has to be done by investigative agencies in coordination.  No single agency has the jurisdiction to investigate this case individually.

How was the response from regulators when you first raised the issue? 

The initial response was very cold, frustrating and disappointing. There is a huge backlog of complaints in every office. Take the case of our markets regulator, the Securities and Exchange Board of India (SEBI), which is supposed to take care of investors’ interests. It acts in a very mechanical way, and the process takes a lot of time. Our system of addressing investor concerns is still very poor.

Did you act as a shareholder in ICICI Bank case or an independent activist? 

I’m a shareholder first. There are thousands of listed companies in the country and all of them have something or other to be spoken about. As an activist, how many cases could you take up? You don’t have time to do research and follow up on all these cases. Unless you are really aggrieved and affected, it won’t take the fight beyond a point.

You are invested in many companies, but chose to take up the ICICI Bank case prominently. Why? 

ICICI Bank is no ordinary listed company. They are the icon of corporate governance and the country’s corporate history. If a top corporate like ICICI Bank gets involved in this kind of misgovernance, it is not hard to see what could be happening at thousands of other listed companies. It was important to raise this case.

It is often small investors who end up being the victims. Why? 
They always invest at a premium after trusting the company's narrative and end up losing money. Shareholders, who form the backbone of corporate democracy and capital markets, are cheated, robbed and looted. I have been asking for a safety net for shareholders.

What’s your message to small investors? 

Don’t give up. Get up, raise your voice and fight until you accomplish your mission. Someday, somewhere, somebody will pick up the call. The biggest problem in this country is that the media’s conscience is compromised. The day right people come forward is when the country’s corporate culture will change.