 "Vijay Mallya denies Diageo's fund diversion charges")
A day after United Spirits (USL) accused Vijay Mallya (pictured) of funds diversion worth Rs 1,200 crore from the company when it was managed by the UB Group chief, the latter denied the new charges.
In a statement, Mallya said he had no knowledge of the additional enquiry conducted by the audit firm, EY.
“I have absolutely no knowledge about this purported enquiry by EY nor the suggested allegations. Surprisingly neither USL nor EY has given me any details of the allegations or any opportunity to respond. I can only reiterate that all transactions were legal, above board and approved by USL auditors, the USL board and shareholders,” Mallya said on Sunday.
“Over and above this, Diageo conducted an extensive due diligence on USL prior to acquiring shares. It is surprising and unfortunate that unfounded allegations are now being made without any reference to me whatsoever,” Mallya said.
After a board meeting on Saturday, USL informed the stock markets that its additional enquiry into the annual accounts showed fund diversion to various Mallya-owned entities, including Force India, Watson Ltd and Kingfisher Airlines.
USL said it would share the EY report with law enforcement authorities in India and with regulators. An earlier report prepared by PwC UK in April 2015 led to the USL’s board to seek Mallya’s dismissal. A defiant Mallya refused to do so, trashing the report prepared by PwC.
Mallya had said PwC was USL’s auditor when the company was managed by him. So, he said, an auditor cannot sign an account and later conduct a forensic audit on it. In February this year, Diageo signed a peace deal with Mallya and gave him an additional $75 million. Market regulator Securities and Exchange Board of India is probing the payout. The enforcement directorate is investigating the fund transfer from USL to various tax haven in British Virgin Islands.
Mallya is living in London and the ED has asked him to join its probe in India but he has refused to do so. Mallya owes Rs 9,100 crore to Indian banks which financed his Kingfisher Airlines.
In a statement, Mallya said he had no knowledge of the additional enquiry conducted by the audit firm, EY.
“I have absolutely no knowledge about this purported enquiry by EY nor the suggested allegations. Surprisingly neither USL nor EY has given me any details of the allegations or any opportunity to respond. I can only reiterate that all transactions were legal, above board and approved by USL auditors, the USL board and shareholders,” Mallya said on Sunday.
“Over and above this, Diageo conducted an extensive due diligence on USL prior to acquiring shares. It is surprising and unfortunate that unfounded allegations are now being made without any reference to me whatsoever,” Mallya said.
After a board meeting on Saturday, USL informed the stock markets that its additional enquiry into the annual accounts showed fund diversion to various Mallya-owned entities, including Force India, Watson Ltd and Kingfisher Airlines.
USL said it would share the EY report with law enforcement authorities in India and with regulators. An earlier report prepared by PwC UK in April 2015 led to the USL’s board to seek Mallya’s dismissal. A defiant Mallya refused to do so, trashing the report prepared by PwC.
Mallya had said PwC was USL’s auditor when the company was managed by him. So, he said, an auditor cannot sign an account and later conduct a forensic audit on it. In February this year, Diageo signed a peace deal with Mallya and gave him an additional $75 million. Market regulator Securities and Exchange Board of India is probing the payout. The enforcement directorate is investigating the fund transfer from USL to various tax haven in British Virgin Islands.
Mallya is living in London and the ED has asked him to join its probe in India but he has refused to do so. Mallya owes Rs 9,100 crore to Indian banks which financed his Kingfisher Airlines.