ICICI-Videocon loan fraud: ‘Chanda Kochhar disclosed Videocon links to husband's firm only after Sebi query in 2018'

An ICICI Bank representative has told the Central Bureau of Investigation (CBI) that former ICICI Bank CEO and MD Chanda Kochhar shared details about Videocon Industries Ltd (VIL) investment in her husband’s company NuPower Renewables Ltd (NRL) only in 2018 after capital market regulator Securities and Exchange Board of India (Sebi) inquired about it.

The CBI has alleged that Dhoot, Chanda Kochhar and her husband Deepak had chalked out a plan to give loans from ICICI Bank to Dhoot’s Videocon group after the private sector lender announced the appointment of Kochhar as its CEO and MD.

The representative's statement is part of the over 10,000-page chargesheet filed by the agency against Kochhar, her husband Deepak, erstwhile Videocon group chairman, VN Dhoot and others, Economic Times reported.

The CBI has named the Kochhars and Venugopal Dhoot, Nupower Renewables (NRL) managed by Deepak Kochhar, Supreme Energy, Videocon International Electronics Ltd, and Videocon Industries Limited, as accused in the FIR.

“...the Bank came to know about the same only on April 30, 2018, when the same was disclosed by Smt. Chanda Kochhar to the Bank in reply to SEBI's query regarding investment of M/s VIL in M/s NRL. The RTL of Rs. 300 crore was sanctioned to M/S VIEL on 26/08/2009 and till then Smt. Chanda Kochhar had not disclosed to the Bank that her husband Shri Deepak Kochhar had business dealings with M/S VIL,” said the representative, who heads the audit team, in his statement before the CBI.

The person further said the bank’s guidelines were different from what the MD did at that time in a particular proposal. “... The Chairman/MD/Director who is directly or indirectly concerned in any proposal would disclose the nature of his interest to the Board when such proposal is discussed. He is required not to be present in the meetings unless his presence is required by the other directors for the purpose of eliciting information and the director so required to be present would abstain from voting on any such proposal”.

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The Kochhars and Dhoot, who were arrested in December 2022, are out on bail at present.

Chanda Kochhar, who was appointed as the bank’s MD and CEO in December 2008, quit the post and went on indefinite leave following allegations of nepotism and conflict of interest in 2018.

The CBI, in its statement, said that Kochhar violated the bank's norms and that the loans sanctioned to Videocon group of companies between 2009 to 2011 when she was the CEO and MD. It said that it is a case of conflict of interest and breach of trust.

The investigating agency has made out a case that six standalone loans sanctioned to the Videocon group of companies were in violation of banking norms.

It further alleged that Chanda Kochhar lived in a flat owned by the Videocon group in Mumbai. The flat was transferred to her family trust where her husband was its managing trustee for a sum of only Rs 11 lakh in October 2016. The actual value of the flat was Rs 5.25 crore.

The CBI further said that Chanda Kochhar accepted “illegal gratification” of Rs 64 crore, while Deepak Kochhar conspired to get credit facilities sanctioned in favour of the Videocon group through Chanda Kochhar, according to the chargesheet.

The CBI said the credit facilities turned into non-performing assets (NPAs) of more than Rs 1,000 crore.

On its part, ICICI Bank has said earlier that it followed due processes while granting loans to the Videocon group and the CBI’s allegations of wrongful loss and violation of rules are not correct. It said that the Videocon group could not repay the loans due to business failure. The bank noted that the bad loan was not a wrongful loss, but a business loss.

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Also read: ICICI-Videocon loan fraud: Venugopal Dhoot had warned Deepak Kochhar Chanda may end up 'sharing room' with Indrani Mukerjea

Also read: Videocon Group loan a ‘business loss’: ICICI Bank on CBI chargesheet against Kochhars, Venugopal Dhoot  

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