Citibank US Top Brass at HQ named in Indian FIR by Top Investor Sanjay Aggarwal of Helion Funds in the Gurgaon Branch Wealth Management Fraud…stirs angry memories of this Bank

This Wealth Managment Fraud of over Rs 300 Crs, claimed to be the ingenuity of a relationship manager of Citibank at it’s Gurgaon Branch in Delhi is now being widened in investigation scope to include even the role of the World Head, Mr Vikram Pandit and Chairman,Mr William Rhodes and ten other Bank Officers in New York.

They have been named by Individual Investor Mr Sanjay Aggarwal in a FIR filed at the Gurgaon Police Station.Mr Aggarwal is the co founder of India’s leading BPO Daksh and currently is the MD of Helion Venture Partners….one can meet him in a fireside chat at the Angel Investors Forum to be held on January 20,2011 in New Delhi    

Mr Aggarwal has lost Rs 32.43 crs in the Fraud committed in the Wealth Managment Division of Citibank in their Gurgaon Branch…..his FIR includes the names of Citibank’s top brass…his contention is that the fraud could not have been committed without the knowledge of the Bank and it’s top officers…bank has to take responsibility for the fradulent actions of it’s officers involved in this fraud as a bank is expected to have checks and balances in place to prevent such frauds occuring

Mr Aggarwal stirs angry memories that I harboured against ‘Citibank’…On November 23, 2008 I had even blogged on  several incidents and experiences with the bank that that created these sour memories over the years

‘citi never sleeps’…well ! Citigroup should !

Sunday, November 23rd, 2008

Citibank must have spotted that something was amiss when some Investors or Potential Investors approached it on the Bank offering Investment Proposals with a higher rate of Return….they rubbish the FIR including the names of the Banks Top Brass as being baseless…the criminal charges are strong against the bank and it’s top honchos…cheating…criminal breach of trust….misappropriation of funds 

My Point is simply this….Citibank is responsible……if checks and balances and internal control systems and processes were in place then this fradulent situation would not have been created….that it has, points to either of two situations…both in which the bank has to be responsible

  • strong checks and balances were not in place…in which case Citibank is responsible
  • checks and balances were in place but there has been collusion within the bank itself to perpetrate this fraud….difficult to believe that one guy could have done it all !…..if this is true then there are no checks and balances in place !……in any case Citibank is responsible for employees actions while being employees and representing the bank…this is the point under debate…..ofcourse the bank  will take action against these employees….but can it escape responsibility ?

Investors are dealing with the Bank and not just it’s employee and relationship manager,Shivraj Puri who has been accused of masterminding this fraud….of course it is too stretched to say Mr Pandit and Mr Rhodes who reside in USA and preside over the whole Bank were aware of this Operation in question at their Bank’s Gurgaon branch…the question raised by Mr Aggarwal’s accusation in his FIR is one of ultimate responsibility read more

Hemendra Kothari to sell his remaining 10% of DSPML to Bank of America…revived sour memories of DSPML

Saw Hemendra Kothari come on NDTV Profit today and confirm that he has sold the remaining 10% he held in DSPML to Bank of America….Some Years ago he had sold 40% to ML for US $ 500 Million…he refused to disclose at what price he sold this 10%,saying it’s an unlisted company….says he’s now 62 and wants to devote time to Philanthrophy(his family,he says,has been involved in it for years) and Environment and Wildlife Concerns…will remain as Non Executive Chairman of DSP Blackrock though…rubbished the notion that he is selling because he was apprehensive about clashing with the culture and way of operations of  Bank Of America,who has taken over ML

Years ago his DSPML refused to buyback from us shares of Namtech Systems…We had invested a significant amount.DSPML had placed these shares with us at Rs @ 55 with a promise that this Nambiar Group Company ( Nambiar was the Chief Secretary of the Karnataka Govt and whose flagship was the listed Namtech Electronics) would come out with an IPO within a year of placement and we could sell in the Markets or else they would buy back the Shares at Rs 113 if the IPO did not materialise or if the Listed price was lower than Rs 113….Those were heady times and being DSPML we trusted them,only to be let down as they dishonoured their word….When approached by us,Hemendra Kothari and the International Head of ML chose  to simply ignore and not respond and walk away from the buy back committment while Nambiar said that he had no role to play in this Buy back Committment even though we pointed out the MOU to him……It’s over Ten years now and Namtech Systems has gone kaput…no business and no IPO…Oh ! shares yet exist…Not sure of the company though !

That’s why we make icons of Narayan Murthy and Ratan Tata….whose word is their Bond  and whose Measure is not measured just by the Money ! 

      

Bank of America…Bubble ?…Bankrupt ?….Breaking Down ?….Going ? …Going?….Gone?

A year ago,USA’s biggest bank ,Bank of America quoted at US $ 43.Yesterday is sank below US $ 4  and recovered to close at US $4.84…down 66 % in January alone this year

Market Cap has sunk below US $ 31 Billion…Bloomberg puts it rather tongue in cheek…One share of Bank of America will not even buy you a Big Mac in New York City.The Big Mac Meal costs US $ 6.59 at McDonald’s in midtown Manhattan

Bank of America received a US $ 45 Billion bailout package from the US Government late in 2008….It awaits and expects more

But what has it done with this US $ 45 Billion !?…Let’s  see

  • It Invested US $ 15 billion to double it’s stake in state owned China Construction Bank
  • For Assets of just US $ 100 million it paid US $ 2.5 billion to Countrywide

It’s buyout of Merill Lynch is already turning bad 

Like Citigroup,Bank of America could also be on it’s way to be broken up to split it’s US $ 1.8 Trillion Assets and 243000 Employees

A Sinking Share Price indicates clearly something BIG IS WRONG WITH BANK OF AMERICA….It appears that Federal Investigators are currently all over the Bank of America  confronting it’s CEO,Kenneth Lewis with chilling evidence of huge mismatch between assets and liabilities and a severe Liquidity Problem that is threatening it’s solvency and survival

Isn’t BOA,a Constrictor !?…It seems the acronym,BOA is a Self Constrictor !