Serious Fraud Investigation Office to grill IL&FS independent directors, others: Sources

An agency under the Ministry of Corporate Affairs (MCA), the SFIO has already questioned the IL&FS auditors, key managerial personnel and its credit rating agencies in this regard.

Published: 15th May 2019 03:29 PM  |   Last Updated: 15th May 2019 03:29 PM   |  A+A-


IL&FS. (Photo| PTI)


NEW DELHI: The Serious Fraud Investigation Office (SFIO) will shortly question former independent directors of IL&FS, as well as experts and consultants associated with the crisis-ridden company for allegedly failing to raise issues concerning its vital interests, official sources here said on Wednesday.

An agency under the Ministry of Corporate Affairs (MCA), the SFIO has already questioned the IL&FS auditors, key managerial personnel and its credit rating agencies in this regard.

"We will go step by step. Auditors, KMPS (key managerial personnel) and credit rating agencies have been questioned. Next, the independent Directors, experts, and consultants will be questioned. Everybody who is associated with the decision-making process-board, management, and committees, including the risk management and audit panels, will be questioned", one source said.

US auditor firm Deloitte, along with its Indian partner, has already been questioned by the SFIO.

Deloitte has audited the IL&FS group over the last 10 years. According to the sources, the SFIO sees Deloitte as having agreed to rely on management explanations and comfort letters, thereby compromising on its independent opinion.

The SFIO is pursuing the line of investigation that these professional managers and panels failed to raise the red flag on the company's mismanagement and audit lapses, and also did not question the board on issues leading to the massive defaults.

Queried on what action the government could take in case of the auditors, and if their licenses would be canceled, an MCA source said: "What action the government can take against the auditors depend on the outcome of the SFIO investigation. It would depend on how the auditors are able to present their case..whether they are able to prove that they had done the due diligence, cross-verified facts and figures presented by the board and had raised an alarm".

"What action can be taken depends upon what evidence is produced in the investigation report and what sort of violations have been committed, the gravity of the offense. Prima facie there is enough material to look into the affairs of the auditors", the source added.

Among the company's independent directors in the company's board during the period in question, were the Maruti Suzuki India Chairman R.C. Bhargava, former bureaucrat Michael Pinto, Sunil B. Mathur and Jaithirth Rao, formerly of Citibank.

Stay up to date on all the latest Business news with The New Indian Express App. Download now
(Get the news that matters from New Indian Express on WhatsApp. Click this link and hit 'Click to Subscribe'. Follow the instructions after that.)


Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on are those of the comment writers alone. They do not represent the views or opinions of or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp