BR Shetty, the founder of distressed UAE hospital operator NMC Health, has taken auditor EY, two former top executives of his companies and two banks to the US Supreme Court in New York seeking $8bn in damages for an alleged multibillion dollar fraud at his former group. According to the NMC founder, EY had issued fraudulent audits and financial reports while being aware of the laundering of illegally obtained loan proceeds. Shetty also accused India’s Bank of Baroda through its New York and UAE branches to be the “principal conduit” for the fraudulent transactions. He also alleged that Credit Europe Bank (CEB) in the Netherlands continued lending and earning fees despite being aware of the fraud. The top executives in question are the Manghat brothers, Prashanth and Promoth Manghat, former CEOs of NMC and Finablr (another company of the Shetty group). Shetty accused the brothers along with their associates and bankers of inflating the companies’ balance sheets and misappropriating funds since 2012. A complaint was also filed with Indian federal investigators in October last year. EY said in a statement: “We believe this case is without merit and we intend to defend it vigorously.” CEB released a statement saying that Shetty’s allegations had “no legal or factual merit”. There was no response from Manghat brothers or Bank of Baroda. NMC Healthcare was put under administration after the revelations of ~$4bn in hidden debt and its restructuring was proceeding as per plan as of April this year. Shetty is himself a subject of criminal complaints by Abu Dhabi Commercial Bank for the fraud. The Shetty family’s bank accounts have also been frozen by the UAE central bank.
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