Top 10 Biggest Financial Frauds in India of All Time

11/21/2018
biggest-scams_mf

Having 79th rank out of 176 Countries in Corruption Perceptions Index, gives no surprise that India successfully produce hundreds of scams (Ghotalas) every year, which is rapidly increasing.

Here's the list of 10 Biggest Financial Frauds in India of All Time:

10. Foddar Scam (₹ 950 Crores)

People Involved: Bihar's CM Lalu Prasad Yadav, Jagganath Mishra, Dr. Dineshwar Prasad Sharma

Lalu Prasad Yadav

The Fodder Scam was a scandal that involved the embezzlement of about ₹950 Crores from the government treasury in Bihar meant for cattle fodder. This spam got spotted in 1996, when Deputy Commissioner Amit Khare raids offices of animal husbandry department, seizing documents showing syphoning of funds by non-existent companies in the name of supplying fodder and Indian Courts take 18 years (altough Lalu Prasad surrendered in 1997) to sentence him for 5 years, from which he get bail in 2 months.

In January, 2018 he got sentenced for 3.5 Years by special court in Ranchi and In March, 2018 He got sentenced for 14 Years in the fourth case related to fodder scam and also fined ₹60 Lakh.

9. Saradha Group Scam (₹ 2500 Crores)

People Involved: Kunal Ghosh, Sudipto Sen, Madan Mitra, Mukul Roy and many more

saradha-protest

Saradha scam was caused due to collapse of a Ponzi scheme run by Saradha Group, a consortium of over 200 private companies that was believed to be running collective investment schemes commonly also known as chit funds. A perceived closeness to the ruling Trinamool Congress in West Bengal allegedly also helped it get investors and agents on board - Saradha had Trinamool Rajya Sabha MP Kunal Ghosh heading its media division and MP Satabdi Roy was featured in its promotional material. Chief Minister Mamata Banerjee had inaugurated two Saradha offices.

The scheme was so attractive that small investors could invest at leat 100 and without any upper limit, with promise of more than 50 percent returns and government support. Company successfully run away with whopping ₹ 2500 crores and according to some sources, figure was calculated near ₹ 4000 crore. Many Ministers got arrested due to ponzi scam in 2013.

8. Uttar Pradesh NRHM Scam (₹ 10,000 Crores)

People Involved: Babu Singh Kushwaha

nrhm-scam-death

Uttar Pradesh NRHM Scam is an alleged corruption scam got placed in Uttar Pradesh, in which top politicians and bureaucrats are alleged to have siphoned off a massive sum estimated at ₹10,000 crore from the National Rural Health Mission, a central government program meant to improve health care delivery in rural areas. At least five people are said to have been murdered in an attempt to coverup large-scale irregularities.

The scam came to light when two Chief Medical Officers, Dr. Vinod Arya and Dr. B. P. Singh were successively murdered in Lucknow. were shot dead in broad daylight outside their homes, by motorcycle assassins, using the same weapon. However, Deputy-CMO Y.S. Sachan and four other officials who were arrested or under investigation got murdered or died under suspicious circumstances.

In Feb 2012, Prime Minister Manmohan Singh himself accused the Mayawati government of misusing NRHM funds.

7. Navy War Room Leak Scam (₹ 18,000 Crores)

People Involved: Abhishek Verma, Ravi Shankaran

Scorpene-submarine

Arms Dealers Abhishek Verma and Ravi Shankaran compromised senior defense officials working in the Navy War Room located inside Prime Minister's Secretariat in India & obtained sensitive data pertaining to military purchases & ongoing defence acquisitions for securing lucrative multibillion-dollar contracts relating to Scorpene Submarines deal of the Indian Navy worth US$6 billion. Ravi Shakaran fled to United Kingdom in 2006. Red corner Interpol notice was issued for him. Even after 8 years of legal battle in UK Courts, Indian Govt failed in his extradition. Abhishek Verma was granted bail in this case in 2008 by Delhi High Court.

The case involved leakage of over 7,000 pages of sensitive defence information from the Naval War Room and the Air Headquarters, having a direct bearing on national security.

6. Stamp Paper Scam (₹ 20,000 Crores)

People Involved: Abdul Karim Telgi

Abdul Karim Telgi

The 56-year-old was convicted of printing, between 1993 and 2002, fake stamp papers in the government security press in Nashik and selling them at a heavy discount to banks, insurance companies and brokerage firms. He took the help of government officials to project a shortage and supply fake stamp papers. Telgi's arrest in Rajasthan's Ajmer in 2001 revealed his vast wealth, including 36 properties and over 120 bank accounts in Delhi, Mumbai, Bengaluru, Chennai and other cities. After his conviction, he was also asked to pay Rs. 202 crore as fine.

Telgi was sentenced six years later to 30 years of rigorous imprisonment in the scam worth hundreds of crores. He died suffering from multiple organ failure in Bengaluru on 23 October 2017.

5. Common Wealth Games Scam (₹ 70,000 Crores)

People Involved: Suresh Kalamadi, Sheila Dikshit

Suresh Kalamadi

Suresh Kalamadi was accused of handing out a ₹ 141-crore contract to Swiss Timing for its timing equipment, the deal was inflated by ₹ 95 crores. It is estimated that out of ₹70000 crores spent on the Games, only half of the said amount was spent on Indian sportspersons.

He literally engraved name of India in hall of shame internationally. Less than 10 days before athletes were to move into the village built especially for them near the banks of the Yamuna in Delhi, foreign crews were invited to tour the apartments that would house delegates. It was an unforgettable open house. There were dog paw marks on bedsheets. Human waste was lying on bathroom floors, left behind by construction workers. International headlines reported on every humiliating detail.

4. 2G Scam (₹ 1,76,000 Crores)

People Involved: Nira Radia, A. Raja, M. K. Kanimozhi, many telecommunications companies

A. Raja

Former Telecom Minister A Raja, along with 14 others, was the prime accused in the 2g scam case, and in the dock are three companies as well, namely Swan Telecom, Reliance Telecommunications and Uninor. According to the Comptroller and Auditor General of India, the scam caused a notional loss of ₹ 1.76 lakh crore to the Indian national exchequer.

In 2012, the Supreme Court of India cancelled 122 licences given out in 2008, calling the allocation unfair. After the 2G controversy, the government switched back to the auctioning of the spectrum, and indeed witnessed highly competitive bidding, lending credence to the high revenue loss figures expounded by the then CAG Vinod Rai. There was No 2G scam according to latest judgement by CBI court and acquitted all the convicted.

3. Indian Coal Allocation Scam (₹ 1,85,591 Crores)

People Involved: Coal ministry under United Progressive Alliance government. Sriprakash Jaiswal

India-coal

Coalgate, as it was popularly known snowballed into a huge political scandal which pulled top leaders and bureaucrats from the previous UPA regime into the probe. A report by the Comptroller and Auditor General of India showed inefficient and possibly illegal allocation of coal blocks between 2004 and 2009. It estimated loss to the exchequer to the tune of ₹ 10.7 lakh crore but it later toned this amount down to ₹ 1.86 lakh crore in the final report.

Industrialists like Naveen Jindal and Kumar Mangalam Birla have also found their name in FIRs in the Coal Scam probe.

2. Punjab National Bank Scam (₹ 13,600 Crores)

People Involved: Nirav Modi, Ami Modi, Neeshal Modi, Mehul C Choksi

Nirav Modi

Punjab National Bank Fraud Case relates to alleged fraudulent Letter of Undertaking worth ₹11,600 crore that took place at its branch in Brady House, Mumbai, making Punjab National Bank potentially liable for the amount. Nirav Modi of Firestar Diamonds, against whom a complaint has been filed with the Central Bureau of Investigation. The transactions were first noticed by a new employee in the bank.

According to the FIR, two junior employees of PNB had been sending these unauthorised guarantees for seven years. Then one of them retired. In January, when representatives of Modi firms asked for a fresh guarantee, the new PNB employee in that position asked for collateral security. On being told that this was never asked for in the past, the bank started investigating and found hundreds of guarantees relating to these firms.

1. Rafale Deal Controversy (₹ 58,000 Crores)

People Involved: Bihar's CM Lalu Prasad Yadav, Jagganath Mishra, Dr. Dineshwar Prasad Sharma

rafale-deal

In April 2015, Prime Minister Narendra Modi had announced that India will buy 36 French-manufactured Rafale fighter jets off-the-shelf from Dassault, the French aircraft builder and integrator. The Rafale was chosen in 2012 over rival offers from the United States, Europe and Russia. The step was needed to upgrade India's ageing fleet. The original plan was that India would buy 18 off-the-shelf jets from France's Dassault Aviation, with 108 others being assembled in India by the state-run Hindustan Aeronautics Limited or HAL in Bengaluru.

The Modi-led BJP government, however, rowed back from the commitment of the last UPA government to buy 126 Rafales, saying the twin-engined planes would be too expensive and the deal fell through after nearly decade-long negotiations between India and France.

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