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Post No: 113042 March 04, 2008, 06:06AM
Guest wrote:

THIS IS A COPY OF THE REPORT SENT BY THE RESERVE BANK OF INDIA - MUMBAI WHICH HAS BEEN FORWARDED TO THE ENFORCEMENT DIRECTORATE FOR VIOLATIONS UNDER FEMA ACT AS WELL AS FOR FORGERY / FABRICATION OF DOCUMENTS

FOREIGN EXCHANGE DEPARTMENT
(FID)

Complaint against State Bank of Mauritius, H&M
& others


A complaint was received by our Department of Banking Supervision

1. It was agreed between these two companies that H&M will acquire the 100%

Shares of VMoksha Technologies Pvt. Ltd. (India) held by VMoksha Technologies – Mauritius (VTM) for a consideration of US$15 mn. It was also agreed that the transaction will be completed within 120 days i.e, before 09.9.2005 and the consideration will be first transferred to VMoksha Technologies

2. H&M immediately issued a press release stating that their company had acquired VMoksha Technologies in a complete cash deal of US$ 19 mn which resulted in to increase in share price of H&M on the Stock Exchanges around Rs. 100 to Rs. 500 in a period of 3 to 4 months.

3. Subsequently instead of crediting the acquisition proceeds to the account of VMoksha Technologies maintained with HSBC Bank, the proceeds were credited to VMoksha Technologies account with State Bank of Mauritius at its Mauritius Branch. It was then observed that this account was purportedly opened in a fraudulent manner by Shri Pawan Kumar – the then CEO & Chairman of VMoksha Technologies with the help of two person's i.e., Chairman & MD of Helios & Matheson.

4. Shri Pawan Kumar also applied for a loan of US$ 13.5 mn with State Bank of Mauritius – at Port louis branch at Mauritius. This amount of loan was immediately sanctioned by the bank against personal guarantees of two persons i.e, Chairman & M.D of H&M (A FEMA Violation).

5. However, the issue relating to State Bank of Mauritius – Port Louis branch sanctioning loan to VMoksha technologies Mauritius against a personal guarantee of two resident Indians i.e, Chairman & M.D of H&M, it was advised by Mumbai branch of State Bank of Mauritius that through inadvertence, RBI's prior approval for such guarantee was not obtained.

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