BlackRock Accuses Indian-Origin CEO in $500 Million ‘Breathtaking Fraud’
BlackRock’s investment arm HPS has accused Bankim Brahmbhatt, an Indian-origin CEO, of orchestrating a $500 million fraud scheme involving fabricated financial documents and diverted collateral.
Key Takeaways
- BlackRock’s HPS alleges $500 million fraud by Bankim Brahmbhatt’s telecom companies
- Fake customer emails and fabricated accounts receivable used as loan collateral
- Brahmbhatt has disappeared, believed to be in India while companies filed bankruptcy
The Elaborate Scheme Unfolds
According to The Wall Street Journal report, lenders have accused Brahmbhatt’s companies – Broadband Telecom and Bridgevoice – of fabricating accounts receivable that were supposed to serve as loan collateral. The alleged fraud involved creating fake customer emails from domains mimicking real telecom companies to verify invoices.
HPS, BlackRock’s private credit investment arm, began lending to Brahmbhatt’s financing operations in September 2020. The investment grew substantially over time, reaching approximately $430 million by August 2024.
Discovery and Disappearance
The scheme began unraveling in July when an HPS employee noticed irregularities with email addresses used to verify invoices. When HPS officials confronted Brahmbhatt, he initially assured them there was nothing to worry about before abruptly stopping all communication.
Subsequent visits to Brahmbhatt’s New York offices found them closed, and his telecom companies filed for bankruptcy in August. A visit to his Garden City residence revealed luxury vehicles in the driveway but no response at the door.
Legal Action and Asset Transfers
Lenders filed suit in August, alleging that every customer email provided by Brahmbhatt’s companies over two years was fake. According to court documents, “Brahmbhatt created an elaborate balance sheet of assets that existed only on paper.”
The lawsuit further claims Brahmbhatt transferred assets that should have been pledged as collateral to offshore accounts in India and Mauritius. HPS has informed clients they believe Brahmbhatt is currently in India.
Brahmbhatt’s lawyer has stated the CEO disputes the fraud allegations, but calls seeking comment on his client’s whereabouts have not been returned.
