By Sonja Methoxha
TIRANA, March 26- Brothers Nitin Jayantilal Sandesara and Chetankumar Jayantilal Sandesara, and their brother-in-law Hitesh Narender Bhai Patel, were wanted in India for money fraud. The three men have allegedly acquired loans amounting to around 1 billion euros from various Indian banks and then dispersed them through offshore companies.
The Sandesara brothers and Patel have been meanwhile leaving in Albania and allegedly investing in various construction projects within the capital Tirana and other seaside resorts. They had been granted Albanian citizenship by President Ilir Meta. Patel was detained as of March 20 after an Interpol notice issued against him, whereas the two brothers are on the run. Patel is expected to be soon extradited.
In October 2017 the Enforcement Directorate (ED) of the Central Bureau of Investigation in India registered a bank loan fraud case against the two Sandesara brothers and their Sterling Group. Together with other staff members the two brothers have cheated banks off around 643 million euros, whereas together with Patel to something more than 1 billion euros. Others to have been implicated in the fraud who have been registered by investigative agencies for prosecution complaints are Vadodara-based pharmaceutical firm’s directors including Dipti Sandesara, Rajbhushan Omprakash Dixit, Vilas Joshi, chartered accountant Hemant Hathi, former Andhra Bank director Anup Garg and some other unidentified persons.
The case filed by the ED alleged that former Andhra Bank director Anup Garg had falsified accounts to help Sterling Biotech raise loans much larger than it would have been able to otherwise. The loans were sanctioned by a consortium of banks led by Andhra Bank, and comprising UCO Bank, State Bank of India, Allahabad Bank and Bank of India.
The loan accounts that amount to 634 million euros have been turned to non-performing assets. These accounts were in the name of various Sterling Group companies, including Sterling Biotech, Sterling Port, PMT Machines, Sterling SEZ and Infrastructure, and Sterling Oil Resources. After adding interest, the total defrauded amount stands at 1.04 billion euros.
According to the ED, Patel was responsible for getting dummy directors for shell companies used by Sandesara brothers to route, divert and launder the money. The Sandesaras used to launder money by forming shell companies, manipulating balance sheets, inflating turnovers, insider trading, etc. They had reportedly set up more than 300 shell firms in India and abroad. These bogus companies were controlled by the Sandesaras through dummy directors, who actually were employees of Sterling Group companies.
These shell companies reported fake transactions among themselves and with the Sterling group of companies in order to divert loan funds and inflate turnovers to obtain further loans from banks. These loan funds were then rotated in multiple layers through the various shell firms to conceal the source of such funds. All this process and money laundering is reported to have been happening between 2008 and 2011.
After the case came to light, the Sandesara brothers, Chetan’s wife Dipti, and their family members fled India to avoid prosecution. The ED had managed to obtain non-bailable warrants against the Sandesara brothers, Dipti Sandesara and Hitesh Patel. The agency has also moved a special court seeking fugitive tag for the absconding promoters. The ED is also investigating various cross-border transactions undertaken by the Sterling Group. The Sandesaras have several business concerns in Mauritius, UAE, Nigeria, British Virgin Islands, Seychelles and USA, among other countries. More than 50 foreign bank accounts and several other assets and properties situated abroad related to the Sterling Group, are also under watch.
The agency has carried out more than 50 searches at various premises in Delhi-NCR, Mumbai, Vadodara, Ahmedabad and Surat under the ongoing investigations. Around March 18, 2019, a Delhi court had allowed the ED to send extradition requests to Albania for the Sandesara brothers. The Sandesaras brothers and Patel have been obtained non-bailable warrants. But as Patel has been detained by the Albanian police while he was trying to flee the country, the Sandesaras brothers are on the run.
“Patel is an accused in the case and is the brother-in-law of the main accused in the case, the Sandesara brothers (Nitin and Chetan Sandesara). He is expected to be extradited to India soon,” investigative officials said.
Residence in Albania
After the fraud became known in India the Sandesara brothers and their family members fled their home country. The brothers eventually settled for Albania from where it results to have also been granted citizenship by President Ilir Meta in February 2018. Law nr. 8389 foresees the general procedures of granting people Albanian citizenship, where its section 9 is about naturalization, meaning for foreigners.
Section 9 of law nr. 8389 foresees that alien citizens getting Albanian citizenship under naturalization must fulfill the following subsections:
- Must have reached the age of 18 years old.
- Must have been legally living within the territory of the Republic of Albania for at least five years.
- Must have housing and to have sufficient income.
- Must have never been convicted in his home country or in the Republic of Albania or in any third country for criminal offenses for which the law foresees sentences of no less than 3 years in prison.
- Must hold at least basic knowledge in the Albanian language.
- His admission as an Albanian citizen must not affect the security and protection of the Republic of Albania.
- An alien who has reached the age of 18 may be granted naturalization of Albanian citizenship even if he does not meet the above mentioned requirements, with the exception of point 6, if the Republic of Albania has a scientific, economic, cultural interest and national.
In a press release the President’s spokesperson Mr. Tedi Blushi explains that “all legal procedures based on point 7 of section 9 to law nr. 8389, date 05.08.1998 ‘For Albanian citizenship’ changed, with the proposal of the Ministry of Tourism and Environment, ‘due to the investment experience and the history of successful enterprises outside of the Republic of Albania and because of their commitment to the realization of important elite investments in our country’.” He also adds that “based to point 6, Article 9 of the Law on Citizenship, relevant verifications were carried out by the law enforcement agency, which did not give rise to any problematic data on the granting of Albanian citizenship.”
However, subsection 6 foresees that the applicant to citizenship must not be a threat to the Republic of Albania. It seems that the law enforcement agencies, and the Presidency have forgot to check on subsection 4 regarding convictions in the home country of the applicant. Depending on the level of fraud the sentence for such cases can reach up to 30 years of prison. More than that, the Indian ED has issued arrest warrants since October 2017, and the fraud case could be easily found on various Indian media.
The two brothers did however invest in Albania on various construction projects within the capital Tirana and other seaside resorts, as promised by the Ministry of Tourism. Yet, the purpose remains that they were laundering their money through these investments.
Chetan Sandesara results to have been appointed as an Albanian Consul of Honor in Nigeria. Nigeria is also one of the many countries in which the Sandesara brothers have had conducted cross-border businesses. After the scandal surfaced the Ministry of Foreign Affairs withdrew his appointing by “firing” him in a sense.
All the procedures as stated in the Vienna Convention have been followed prior to granting the mandate to Sandesara. As of the mandate retraction, the Ministry of Foreign Affairs said in a public statement that the reputation of the institution of the Counsel of Honor together with that of the Ministry and Albania would be impinged in case this decision wasn’t made, regardless of the personal actions of Sandesara. The Ministry added that it holds full legislative competence for terminating the mandate of Sandesara in Nigeria.
Former Minister of Foreign Affairs Ditmir Bushati wrote a Facebook post regarding the situation.
“In any case there are the proposing and expecting country’s specialized agencies that deal with the proper verifications whether the person is clean. It is enough to research the documentation to understand that rigorous procedures have been followed,” wrote Bushati.
Officials from the Ministry of Tourism have also responded on the same manner that all proper procedures have been followed prior to proposing and admitting these persons as Albanian citizens. Thus, all these three institutions are detracting the fault, leaving us still confused about whose to be held accountable.
