Once famous for his fleet of Rolls Royces, private jets and yachts, Shetty is now under intense pressure from lenders and banks to declare his full list of assets, holdings and investments.
Until two years ago, Bavaguthu Raghuram Shetty, who migrated from Karnataka to the Gulf in the 1970s to set up a worldwide healthcare and hospitality empire, was considered one of the richest Indians, ranked in the Forbes list of billionaires with a net worth of $3.15 billion.
Today, he faces a travel ban. Indicted by the Karnataka High Court, he has been told to come clean on his assets. This, after a 2020 report from investment firm Muddy Waters, highlighted his high borrowings which are today pegged at $6.6 billion. His assets in the UAE and his companies in the London Stock Exchange frozen, Shetty is back in Bengaluru — only to face charges of non-repayment of debts to a slew of Indian banks.
Loans, of which he was the guarantor, are to the tune of Rs 2,000 crore towards Bank of Baroda and Rs 800 crore towards Punjab National Bank. On November 14, 2020, Shetty was denied permission to fly back to the UAE from Bengaluru.
Once famous for his fleet of Rolls Royces, private jets and yachts, Shetty is now under intense pressure from lenders and banks to declare his full list of assets, holdings and investments. In April this year, the Karnataka High Court said: “Prima facie it appears that (Shetty) has declined to disclose his other assets… the apprehension is that the defendants may dispose of their assets so that the same would disappear by the time a judgment is delivered against them or against the entities/companies controlled by them.”
But now the Pandora Papers show that Shetty set up a complex offshore company network in Jersey and the British Virgin Islands, mostly in 2013, and these companies hold shares of branches of his flagship company, Travelex Holdings Limited, headquartered in the UK.
A “corporate chart” in the secret data, updated until October 2017, shows that Travelex had 81 separate companies including in Switzerland, Panama, Brazil, China and Japan, besides the US and UK.
The Trident Trust papers show that a BVI company, Brave City International Holdings Inc, was set up in August 2013 with $50,000 as its authorised capital and Shetty as Director. Its shareholding was split among Shetty’s other BVI companies.
Among sweeping authorisations given to Shetty as Director of Brave City International Holdings in 2013 were powers to open and close bank accounts; administer any business including the collection of all money due to whosoever; and to deal with Government Authorities/ Free Zone authorities, including signing of all documents.
The Trident Trust data shows that several members of Shetty’s family are among the shareholders in these clutch of offshore companies.
Shetty’s wife Chandrakumari Raghuram Shetty holds half (25,000 shares of $1 value each) of BRS Investments and his son, Binay Shetty, is listed as one of the Directors of Travelex Holdings Limited. His brother Bavaguthu Sachinananda Shetty was also nominated as Director of SFG Inc, another company incorporated in the BVI in 2013, with an authorised capital of $ 50,000.
It was to attend to his brother’s illness that Shetty travelled to India last year. Sachinananda passed away in March 2020 and soon after that, Indian banks moved in with recovery cases against Shetty. Due to the Look Out Circular issued in his name, he has not been allowed to fly out of Bengaluru.
Responding to queries from The Indian Express, Shishir Shetty, Shetty’s nephew, said: “Since the matter is sub judice in many jurisdictions, it may not be appropriate for Dr Shetty to comment at the moment.”
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