The crisis at Hero Corporate Services deepened today in the multi-crore Citibank financial fraud, with the company saying it has identified two more employees who possibly colluded with Associate Vice-President Sanjay Gupta and Citibank employees. The company has started an internal enquiry to determine if more employees are involved.
“Following an initial internal inquiry, two employees — Ganpat Singh and Gaurav Jain — working in the accounts department have also been identified to have been in possible collusion with Sanjay Gupta and Citibank employees,” Hero said in a statement.
Singh and Jain have been asked to proceed on leave with immediate effect. Gupta has already been suspended. “Further appropriate action will be taken after the final outcome of the inquiry,” the statement added.
Gupta was arrested on Monday morning after the police obtained evidence that he had fraudulently invested around Rs 250 crore. The money invested by Gupta belongs to the promoters of Hero Group companies. Soon after his arrest, Gupta was sent to police remand for five days.
Gupta’s name had first cropped up during the interrogation of prime accused Shivraj Puri, a relationship manager at Citibank, who had access to investment details of several high net-worth clients at Hero.
Senior officials of the Gurgaon police said Gupta’s role became clear after officials of market regulator Sebi checked available documents and helped question Puri again. Puri had confessed that Gupta was aware of the forged Sebi letter, on the basis of which funds were elicited from HNI clients.
“We were suspicious about (Gupta’s) role after the police had questioned him initially. We believe that he was not only aware that the Sebi document shown to dupe investors was forged, but that he had also invested around Rs 250 crore from different Hero Group companies and their promoters. He had formed two finance companies, BG Finance and G2S, and also extracted a commission of nearly Rs 20 crore from Shivraj Puri,” said S S Deswal, the Gurgaon police commissioner.
The Gurgaon police arrested Gupta under sections of the Indian Penal Code dealing with criminal conspiracy.