Liechtenstein Black Money Trail and Lilavati Hospital, Mehta Brothers connection – CNN IBN expose

Liechtenstein Black Money Trail and Lilavati Hospital,
Mehta Brothers connection – CNN IBN expose

Updated on Friday, April 22, 2011 – 10.41 PM IST
Updated on Wednesday, April 06, 2011
Updated on Friday, March 18, 2011 –

A PIL was filed in Supreme Court asking for criminal proceedings against Mehta brothers a month after CNN-IBN exposed the money trail in Lilavati Hospital.

Few weeks back media exposed, brought before India the 16 names of people who kept their black money in tax heaven nation Liechtenstenin, LGT banks.

The Mehta brothers, along with their sons, Chetan and Bhavin are trustees of Mumbai's famous Lilavati Hospital.


When the list was out CNN IBN carried our their own investigation and they found that
Over the last nine years, they have siphoned hundreds of crores of money out of the hospital into foreign accounts via the hawala route.

Between 2002-2010, nearly Rs 500 crore was spent to buy medicines and pharmaceuticals but in reality Rs 250 crore was diverted via hawala in banks accounts in several tax havens.

And between 2002 and 2010, nearly Rs 125 crore was spent to buy medical instruments, and of that, nearly Rs 50 crore was diverted in foreign accounts.

CNN-IBN has found out Mehta brothers use to launder money are in six key foreign bank accounts –
1. HSBC Private Bank in Bahamas
2. HSBC Private Bank in Mauritius
3. HSBC Private Bank in Singapore
4. ABN-AMRO Private Bank in Geneva
5. Credit Suisse in Dubai
6. UBS in Dubai.

A close scrutiny of the official list of the medical suppliers to the Lilavati Hospital revealed that since 2002, the hospital has not been buying medicines directly from any manufacturers or even distributors.

Without any tenders or requisite approvals from the board, Lilavati sources their medicine from 400 small individual medical stores and out of those, 250 are located in the slums of Dharavi.

And in the balance sheets of Lilalavati since 2005, Rs 35 crore is outstanding to Mayfair Realtors & Vesta Ltd, the firm which was contracted to deliver machinery to Lilavati.

But till 2011, the firm has not even delivered a screwdriver to the hospital.

Mayfair Realtors & Vesta Ltd is owned by Suresh Motwane, a declared absconder wanted in 40 cases of fraud and cheating by Mumbai police.

Prabodh, Rashmi, Chetan and Bhavin have also used crores of trust's money to fund their personal legal battles.
The CNN-IBN investigation has found that their foreign accounts are not just simple instruments of tax evasion, but of large scale money laundering.

Kirtilal Mehta started the Lilavati Hospital.
In 1932 he started Gembel European Sales in Belgium. More specifically, the city of Antwerp, the diamond capital of Europe.
In 1970 Kirtilal Mehta handed over the global diamond trading company to his sons - Prabodh Kirtilal Mehta and Rashmi Kirtilal Mehta.

The company Gembel buys rough stones and then works in partnership with jewellery designers and manufacturers to produce exquisite polished pieces for high-net-worth consumers.

In 2007, Gembel European Sales and it's main owner Prabodh Mehta was convicted of money laundering, fraud and forgery in diamond business in Belgium.

According to court documents available with CNN-IBN, they were implicated in laundering 26 million Euro, nearly Rs 170 crore.
Prabodh was sentenced to 6 months imprisonment and 3-year probation.

And Prabodh's son Chetan was convicted in Israel for the charges of trying to bribe government officials.

After this also by breaking all the rules of Reserve Bank of India, RBI they became shareholders and directors in ING Vysasa Bank and ING Investment Management.

ING investment Management manages more than Rs 50,000 crore of public money.

Kirti Equities Private Limited is the third largest shareholder of ING Investment Managament (India) Limited with a 14.34 per cent stake.

CNN IBN investigation found that Kirti Equities Private Limited is registered in the Mumbai residence of Rashmi Kirtilal Mehta.
But it is held by Kirti Communication, a company owned by the Mehta brothers and their sons in Les Cascades in Port Louis, the capital of the tax haven of Mauritius.

CNN IBN also found that Vijay Choraria was the common link between the Mehta brothers. He is a Director of Kirti Equities and a trustee at Lilavati hospital nominated by Prabodh and Rashmi Mehta.

De-Five (Mauritius) Holdings Ltd, which till 2010 held nearly 3 per cent in IndusInd Bank, it is suspected that De-Five (Mauritius) Holdings Ltd is owned by the four Mehtas.

Now we have to think on following questions?

why the Government, when knew them as having illegal funds and being convicted money launderers, did not write to agencies to check their various investments in India, source of funds and ask for further investigation.

Why did the Government not tell SEBI, banks and RBI to remove them from their shareholding and investments in ING Vysya and IndusInd, and stop them from managing public funds and jeopardizing the banking industry?

Very Interesting fact CNN IBN found that Gembel European Sales in Belgium
the flagship company of Prabodh Kirtilal Mehta, Rashmi Kirtilal Mehta and their sons - Chetan and Bhavin - yet, these balance sheets of Gembel shows that the company made an overall profit of just Rs 2.5 crore over the past eight years, from 2001 to 2009.

According to the 2002-2005 balance sheets of Gembel, the company made net loss of 1.9 million Euro or Rs 12 crore.

In 2006, the company made a net profit of $300,000, but in 2007, it suffered a net loss of $600,000.

Gembel was not making big profits but still Mehtas register a company in Singapore - Arpee Gems Private Limited, with a capital infusion of $18 million that is nearly Rs 90 crore.

So who were the shareholders of the company –?

While B&C Manufacturing (Mauritius) is a shareholder in Arpee Gems, Burmaruby (Mauritius) is a shareholder in Arpee Gems.
On the other hand HSBS Trustees Limited is a shareholder in Arpee Gems (Singapore) along with Bhavin and Chetan.
Arpee Gems from Singapore pumps money into a Mumbai-based company Adesh International.

Balance sheet of Adesh International also revealed unsecured loans from Gembel Mauritius every year.

The trick was very simple Lets Understand how the black money moved from one to another company.

Step One –
Laundered Money funds were brought into Adesh International as capital
Thus black money became white.

Step Two –
Adesh then bought bogus bills in Indian market to purchase stock of diamonds and then exports diamonds to bogus parties overseas.
Step Three –
The bogus parties, which have tainted fund, sent them to India against the export, thus making the funds legitimate.

Step 4 –
Adesh then apparently paid money to the party from whom it brought the bogus bill in the first place as it has an outstanding against that bill.

Still you did not understand,
Let me make more simple,

Black money comes to A –
It became white.
Then fake bills created, fake sale was shown
Thus again the foreign party paid the money,
Without any real transaction,
Thus foreign party sends money and A make it legal.

Like this simple happens.

What Belgium can do it, we can not do it.
Still you say India is super power.

Updated on Wednesday, April 06, 2011

The Supreme Court on Wednesday issued notices to CBI, ED, SEBI and Central Government on a petition seeking investigation into alleged money laundering
And criminal proceedings against the trustees of Lilavati Hospital in Mumbai.

The petition sought criminal case against the five trustees.

According to the petition, they are involved in money laundering and siphoning black money through the accounts of the hospital.

Lilavati money laundering case will be heard by same bench which is currently hearing Hasan Ali case.
The same bench will hear both the cases at the same time.

The government agencies will also try to find out is there any connection between 2G scam and Lilavati money laundering case.
The reason for this investigation is the common address Les Cascades building, Edith Cavell Street, Port Louis, Mauritius

The same address has been used by more than nine offshore companies, which are part of Indian telecom companies linked to the 2G Spectrum scam.

CNN IBN investigation also found out that Les Cascades building is also the address of the front companies of the four permanent trustees of Mumbai's famous Lilavati Hospital

Updated on Friday, April 22, 2011 – 10.41 PM IST

The Union Bank of India sent notice to Mumbai's Lilavati Hospital, has threatened to freeze all accounts and operations of Lilavati Hospital Trust.
The Union Bank has given Lilavati trustees seven days to submit a joint fresh mandate for operating the accounts.

Lilavati Hospital Trust's fixed deposits have already been frozen by the Union Bank of India.


Reality views by sm –
Friday, February 18, 2011

Source – ibnlive.in.com

Suggested Reading –
A Case of Black Money – India, Germany and LGT Bank in Liechtenstein –
Complete story – No Right to Know Names of 26 Criminals

http://realityviews.blogspot.com/2011/01/case-of-black-money-india-germany-and.html

Know the 16 names of Indians who kept their money in LGT Bank

http://realityviews.blogspot.com/2011/02/know-16-names-of-indians-who-kept-their.html