Sebi Cracks Down on DHFL's Financial Misconduct
Sebi has banned former DHFL executives including Kapil Wadhawan for up to five years over financial fraud, fund diversion, and book fabrication. Six individuals face Rs 120 crore in fines. DHFL engaged in fraudulent practices, mislabeling unsecured loans to entities linked to its promoters as retail housing loans.
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- India
The Securities and Exchange Board of India (Sebi) has banned six former executives of Dewan Housing Finance Ltd (DHFL) from securities markets for up to five years due to severe financial irregularities. Among those barred are former CMD Kapil Wadhawan and ex-director Dheeraj Wadhawan, both facing a five-year prohibition.
Sebi's comprehensive 181-page order outlines a decade-long fraudulent scheme involving DHFL's promoters, directors, and key managerial staff. The order reveals how unsecured loans were deceptively listed as retail housing loans, directly impacting the company's perceived financial health.
By concocting fictitious interest income and bypassing loan appraisal standards, DHFL succeeded in portraying an inaccurate picture of profitability and sound financial standing. Sebi identifies Kapil Wadhawan and Dheeraj Wadhawan as primary architects of the scheme, perpetuated with support from other board members.
(With inputs from agencies.)
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