Web Report
Abu Dhabi Commercial Bank (ADCB) has filed a criminal complaint against NMC Health, alleging “fraud and forgery” against six people, including its founder BR Shetty, and former CEO Prasanth Manghat.
ADCB, which has the largest exposure of Dh3 billion to NMC Healthcare, confirmed the move in a statement on Wednesday but did not identify the other accused.
The Abu Dhabi-based bank announced that it was “acting on its own behalf and on behalf of its subsidiary Al Hilal Bank and its acquired bank United National Bank”. The charges levelled against the accused include forgery of financial records and fraud.
“The fraud was committed as a result of collusion between the accused to fabricate and use forged financial statements in which they had willfully misstated the accumulated liabilities of the NMC Group,” the lender said.
Besides, “the accused presented false valuations to ADCB and its subsidiaries and materially misstated their ability to service the best such that the complainant was fraudulently deceived into granting facilities which NMC drew down,” the bank mentioned in the complaint.
Shetty, who is India, said that he had worked with all lending banks for decades as they were key partners that helped him build his businesses in the UAE.
“As I said last week, given my own legal and forensic investigations are now starting to produce some findings, and in consideration of some of the misleading and false allegations that have made against me, I will be looking to respond in the appropriate manner and with the appropriate authorities both in the UAE and elsewhere,” Shetty said.
Apart from requesting for the opening of a criminal case against the accused for the offences cited, ADCB pleaded to the public prosecution to conduct “an investigation into the accused and their involvement in the offences outlined in the complaint and issue a travel ban to prevent them from travelling” and direct “the Central Bank to freeze all accounts belonging to the accused and all their family members, up to three degrees removed, as well as private company accounts belonging to them, to prevent disposal of assets”.
The bank also requested the prosecution to direct “all economic departments and free zone authorities in the UAE to identify and freeze all companies or economic entities belonging to the accused, or members of their families to prevent the disposal of assets, including any movable and/or immovable property and real estate inside and outside the state; and authorize a raid and search of the residence of all the accused including the confiscation of all papers and financial documents, computers and any other relevant evidence.”
Abdulaziz Al Ghurair, chairman of the UAE Banks Federation, has said what happened with NMC “is a world-class fraud, and the management and board members should be held accountable.”
Faisal Belhoul, chairman of Ithmar Capital Partners, who had to quit within days after taking over the reins of NMC Health as its executive chairman last week, said on Tuesday it was crucial that “an investigation into all wrongdoings at the company should be pursued.”
NMC Health has a market value of $2.4 billion and a total debt of $6.6 billion. Since December 2019, after the US short-seller Muddy Waters questioned its financial irregularities, NMC share value had shrunk by more 70 per cent.
More than 80 local, regional and international banks have exposure to the scandal-marred firm. Banks in the UAE had disclosed nearly Dh10 billion exposures.
