Malvinder Singh, the elder of the two brothers, authorised the fund diversion from Fortis Heathcare to related entities. It has been revealed in an external investigation that found that Fortis had loaned about Rs 500 crore to certain corporate bodies, which subsequently became part of the Singhs’ corporate group.Also Read - Gurugram's Fortis Memorial Research Institute Starts Sputnik V Trial Run For General Public
While both the brothers are connected to these entities, Shivinder Singh, the younger brother, remained as a “ghost entity”, according to a report in the Economic Times. The report said that Shivinder Singh was not directly involved in the transactions though he was aware of these transactions. Also Read - Oxygen Shortage: Delhi Hospitals Say Situation Comparatively Better, Reopen Admissions | Details Here
At the time the transactions took place, Malvinder Singh was the executive chairman while Shivinder Singh was non-executive vice chairman of Fortis Healthcare. They are reported to be founder directors in three entities that received inter-corporate deposits from a Fortis subsidiary. Also Read - Former Ranbaxy Promoter Shivinder Singh Gets Bail in Money Laundering Case
Fortis Healthcare on Wednesday said it has initiated legal action to recover about Rs 500 crore of funds allegedly taken out of the company by its founders Malvinder and Shivinder Singh after an external investigation found lapses in the loan given. The loans were given to its founders without board approval and enough collaterals.
The firm also annulled the appointment of former executive chairman Malvinder Singh as ‘Lead: Strategic Initiatives’ and said would try to recover payments made to him as well as any company asset in his possession.
Following the Delhi High Court order upholding the Rs 3,500 crore arbitral award in favour of Daiichi Sankyo, in February this year Singh brothers resigned as directors from the board of Fortis Healthcare.
Fortis started an external investigation in February this year, following allegations of siphoning off cash by the founding family. Fortis in the regulatory statement said it has made provisions totalling around Rs 580 crore in the fourth quarter of 2017-18 fiscal pertaining to the loans whose “recoverability is doubtful”.
(With PTI inputs)