Investigation into the IL&FS fraud has found that a top executive allegedly helped a senior official of Fitch Ratings purchase a duplex villa at a discount when a circuitous transaction with a defaulter borrower was underway in 2012-13.
“Fitch was first made aware of these historical allegations on Monday (June 10, 2019) via the media. We are investigating but have no further information at this time,” the spokesperson said.
The investigation by the government’s white-collar crime probe agency SFIO has already unearthed connivance of auditors and independent directors with the then top management of IFIN (IL&FS Financial Services Ltd) in defrauding the company.
IFIN and several other group companies have been found to have indulged in multiple circuitous transactions involving several illegalities, including fast disbursals to some borrowers despite their bad track record in servicing existing loans and also delayed recoveries.
As per the investigation report, which is part of the first chargesheet filed by the Serious Fraud Investigation Office (SFIO), IFIN and other entities from the IL&FS group continued to enjoy high ratings from various rating agencies, including due to window-dressing of the company’s books.
According to the report, part of a loan disbursed to SIVA Group was used by the borrower to pay IFIN for the liabilities arising out of a debt syndication fee.
This fee was paid by SIVA group to IFIN for services rendered by IFIN for debt restructuring carried out by the company.