MAJOR

NAME-
TATHAGATA CORPORATE
BISWAS
REGISTRATION
NO-190415100004
SCANDAL IN
INDIA AND
ABROAD
 MAJOR CORPORATE SCANDAL IN INDIA AND ABROAD
1. Bhushan Steel
Bhushan Steel was an unprecedented case of defrauding major banks of India. The company was acquired by Tata Steel, though matter is
still under litigation. 
Promoters of the otherwise profitable company, with modern large-scale plants, indulged in multiple fraudulent practices of: 
•Transfer of   funds borrowed by the company to various related parties by way of loans or advances 
•Accounting of bills for capital and other purchases, which were never incurred and funds so generated were misappropriated by
promoters for their benefits
•Amount involved was around Rs. 50000 crores.
Bhushan Power and Steel (BPSL), another group company is currently under IBC. JSW Steel is expected to acquire BPSL.
According to the CBI, BPSL diverted around Rs 2,348 crore through its directors and staff from the loan accounts of various
banks, into the accounts of more than 200 shell companies without any obvious purpose.
2.  Jet Airways
The airline, which was once India’s pride, landed in IBC for rescue. After multiple
bidding over 18 months, Jet finally had a bidder (with an investor), who is non-
experienced in the airlines business.
Jet had acquired an unassailable position in the industry and was a preferred airline
for the business community, top industrialists and CEOs of the country. Its service
standards were its USP.
Lenders’ exposure to the airlines, amounts to around Rs 8500 crores and total
liabilities of around Rs.25000 crores including dues to vendors, employees, AAI, lessors
of aircrafts.    
The company indulged in multiple fraudulent practices of -
•overstating commission paid to a Dubai related party based in Dubai for years. This
resulted in significant overstatement of expenses and underreporting of profits.
•diversion of funds by giving loans of around Rs.3353 Crores
•accounting of invoices of fake  on Jet miles
•other similar transactions
Employees lost jobs with huge arrears of salaries. Further, acquisition of low-cost
service airline, Sahara Airlines - in hindsight, the acquisition proved to be its nemesis
and accelerated the downfall of Jet Airways.
3. ILFS
 ILFS fraud was the largest corporate fraud in India and triggered a showdown in the economy, as the
company was a key vehicle for infrastructure development of the country. Fraud occurred, in spite of
marquee shareholders like LIC, SBI etc., being the largest shareholders, having representatives on board.
ILFS had the largest debt exposure of around Rs. 91000 crores (including Rs, 20000 crores invested by PF
and pension funds),
 Fraud was perpetrated mainly by: 
• Diversion of borrowed funds to related entities of some of members of top management team
• Imprudent lending to parties who were not credit worth for ulterior motives
• Evergreening of loans by routing money from one group company to another through an unrelated party
• Over invoicing of project costs by vendors, accounting of fake expenses etc and difference being routed
back to related entities of some of members of top management team
• Overstatement of profits by non- provisioning of loans, accounting of fake expense, inappropriate
recognition of project revenue etc.
• The company had unprecedented number of subsidiaries and group companies, (346) which were used to
route above transactions
• Non – disclosure of some of these companies as related parties
• Non-disclosure some of subsidiaries, associates, joint ventures
4.DHFL
 The DHFL fraud was the first-ever in a housing finance corporation, and it arose
primarily as a result of promoters’ active participation in syphoning funds and
alleged money laundering. The fraud was committed in the following ways:
• Providing loans to promoters’ associated parties
• The loans issued to parties who were either uncreditworthy or unknown, with
the same addresses in different parts of the country.
• Approximately 6 lacs dummy accounts were established at one branch, using
the names of borrowers who had already repaid their loans. These accounts
were used to issue loans to promoter firms, which were then used to syphon
funds. These loans turned out to be non-recoverable in the end.
• Borrowed funds are used for personal reasons, such as purchasing personal
estate, yachts, and so on.
• As a result, large sums that were not recoverable were shown as recoverable in
the balance sheet.
4.Apple scandal
 The biggest scandal to hit Apple in recent years is undoubtedly the ‘batterygate’ of December 2017.
 This started when a Reddit user reported that a software update had reduced the performance of their
iPhone but that this had corrected itself when they replaced the battery. This post led to a lot of press
coverage, with some commentators suggesting that Apple was trying to force users to upgrade by
deliberately slowing devices as they aged. Tim Cook issued a statement on the matter a week after the
news broke, confirming that the software was designed to throttle performance but claiming that the
intent was only to prevent unexpected shutdowns, which could affect devices with older batteries. The
company offered a discount on battery replacements as a gesture of goodwill for those affected.