Investigators probe Venugopal Dhoot’s involvement in a second loan fraud case

Videocon's Venugopal Dhoot was recently arrested by the CBI in bank fraud case. (File image)

Investigations into a second loan fraud case involving industrialist Venugopal Dhoot are picking up pace. Dhoot is already under arrest in a Rs 3,250-crore loan scam involving former ICICI Bank chief Chanda Kochhar and her husband Deepak Kochhar.

In April 2020, the Central Bureau of Investigation (CBI) filed a second First Information Report (FIR) against Dhoot and others. Moneycontrol has reviewed the copy of the FIR.

What is the case?

According to the FIR, in April 2012, a consortium of banks led by the SBI sanctioned the issuance of a Standby Letter of Credit (SBLC) for $2,773.60 million to Videocon Hydrocarbons Holding Ltd (VHHL), a subsidiary of Videocon Industries Limited (VIL). This was for the appraisal and development of their overseas oil and gas assets in Brazil, Indonesia, and Mozambique.

Subsequently, an SBLC facility of $1,103 million was refinanced extended to VHHL, which included $400 million owed to Standard Chartered Bank (SCB) in London. Thus, in total the bankers’ consortium extended finance worth $$3,876.6 million to VHHL.

In February 2013, VIL reportedly informed the consortium of banks that the loan from SCB had increased from $400 million to $530 million. The SBI-led consortium, without any verification or inquiry, allegedly approved and paid the entire amount of $530 million for payment to SCB. Per the FIR, even after paying the outstanding to SCB, the charge on VIL’s oil and gas assets was not taken over by the consortium, and the loan account of VHHL with SCB was not closed.

“The consortium, in connivance with VIL, allowed VHHL to avail of credit from SCB backed by the oil and gas assets. VIL did not inform its lenders about continuing to avail of credit from SCB, nor did the lender ask VHHL for the closure / NOC documents,” the FIR said.

It further alleged that in November 2013, the consortium, “in conspiracy with VIL,” did not raise any objection when VIL again requested the consortium to pay the outstanding of SCB, which was already approved for payment paid in February 2013. The consortium agreed that the outstanding had to be paid, but should not exceed $650 million.

“However, it was found that $705.45 million was paid to SCB as against the agreed $650 million, from the sale of VIL’s Mozambique assets,” the FIR said.

In the end, the FIR said: “The fact and circumstance prima-facie shows that unknown officers of the consortium led by SBI, in conspiracy with Venugopal Dhoot and other unknown persons, allowed VHHL to continue to avail of the credit facility from SCB by not creating a charge on the Mozambique assets of VIL, and thereby caused wrongful gain to VIL and wrongful loss to the consortium.”

The loan sanctioned to Videocon by the consortium was $2,773.6 million, the equivalent of Rs 14,145 crore in 2012 at an exchange rate of Rs 51 against the dollar. Per today’s exchange rate, this would be much higher.

Kochhar case

Dhoot was arrested in December in connection with the Rs 3,250 crore ICICI Bank-Videocon loan case.

Dhoot allegedly invested in a company floated by former ICICI Bank CEO Chanda Kochhar’s husband Deepak Kochhar, in a quid pro quo for a loan given by the bank when Kochhar was heading it.

Dhoot, Chanda Kochhar, and Deepak Kochhar are currently in judicial custody over violations of the Banking Regulation Act, RBI guidelines, and the credit policy of the bank.

In the first FIR registered in 2019, the CBI had named the Kochhars and Dhoot, along with the companies Nupower Renewables (managed by Deepak Kochhar), Supreme Energy, Videocon International Electronics, and Videocon Industries, as the accused in its FIR under sections of the Indian Penal Code related to criminal conspiracy and the Prevention of Corruption Act.