Probe in Goldman Sachs fraud case deepens

Other employees too will be questioned; police have 14-day custody of accused VP and aide.

Published: 12th September 2019 06:37 AM  |   Last Updated: 12th September 2019 01:43 PM   |  A+A-

Ashwani Jhunjhunwala

Goldman Sachs vice-president Ashwani Jhunjhunwala

Express News Service

BENGALURU: There seems to be more than what meets the eye in the case of investment firm Goldman Sachs vice-president (settlements) Ashwani Jhunjhunwala and his aide Vedant Rungta in the financial fraud case. The police will be questioning other employees of the firm to find out if there were more people involved in the case and also check if any such frauds had been committed by Jhunjhunwala earlier, sources told The New Indian Express.

The Marathalli police, who are investigating the Rs 38 crore fraud ($5.4 million), have 14 days custody of Jhunjhunwala and Rungta. “We will subject both to further questioning to check other angles in the crime,” said Deputy Commissioner of Police (Whitefiled) M N Anucheth.

“We are yet to question them in detail. Preliminary investigations have revealed that Jhunjhunwala siphoned off the money to repay debts he had incurred by playing online poker. We will inquire with other employees of the company too,” said a senior investigating officer. Police will also question the company’s legal team as to why the company had not informed the police when Rungta had committed a similar fraud last year. “We are trying to figure out why there was no police complaint registered when a fraud of similar nature had happened,” said the officer.

Ashwani Jhunjhunwala has been booked under Sections 34 (common intention), 408 (criminal breach of trust), 419 (cheating by impersonation), 420 (cheating) and 409 (criminal breach of trust by a banker) of the IPC.His wife and relatives knew that he would play poker online, but they didn’t know anything about the losses he had incurred. According to police, she was shocked when she came to know that her husband had got so addicted that he had gone to the extent of committing a fraud.

“According to the wife, in her statement, Jhunjhunwala had a good name in office and she didn’t know that he had such an addiction to poker. She was shocked,” said an officer. Ashwani and his wife hail from Kolkata and the couple have a five-year-old child. Meanwhile, the company has not made any official statement pertaining to the case. It has also reportedly issued gag orders to all its employees not to discuss the case with the media.

The complainant and legal head of the company, Abhishek Parshera, lodged a complaint with the Marathalli police on September 8 alleging that Jhunjhunwala had made fraudulent transactions from two accounts on September 4. He said that an internal inquiry was conducted and it was revealed that Jhunjhunwala was directly involved in it. Jhunhunwala has been accused of logging on to computers of his juniors Gaurav Mishra, Abhishek Yadav and Sujith Appaiah and carrying out the illegal transactions. 

“On September 6, he had sent them away on an errand and transferred the money. Jhunjhunwala even asked Gaurav to set up an SRS for payment recall. Since he is new to the firm, he did not understand the process. Jhunjhunwala took control of his computer and created the SRS,” Parshera said in the complaint.

“Gaurav found this to be a bit suspicious and investigated this further along with the help of other colleagues. Upon review, he saw that a third-party Standard Settlement Instructions (SSI) was set up using his credentials. Since he did not recall setting this up, he got suspicious and brought the matter to the notice of his higher-ups. 

“Based on internal investigations, including review of CCTV footage, it was ascertained that Ashwani did in fact have control of the computers of the three employees, which matched the system timestamp of setting up the SSI, its authentication and approval, which corresponded with the statements provided by the employees,” the complainant stated. Jhunjhunwala allegedly admitted to the fraudulent transactions during the internal enquiry. 

“In addition, he also admitted that he has suffered losses of approximately Rs 47 lakh playing online poker. He admitted to taking loan of Rs. 25 lakh from a private bank and personal loans from certain individuals. He stated that in July, he had contacted Vedant Rungta, a former employee of Goldman Sachs, via Facebook to establish a relationship and obtain a loan from him. 

“He also mentioned that he knew that Vedant Rungta was a wealthy individual and had perpetrated a fraud against Goldman Sachs. This led to a dialogue with Rungta and a meeting where he lent Ashwani around Rs 7 lakh, which was paid towards loans availed from individuals,” the complainant said.

It was also alleged that Rungta asked Jhunjhunwala to perpetrate a fraud by transferring $10-12 mn to a third-party account in Hong Kong. Jhunjhunwala, who initially refused, agreed to do it as Rungta allegedly told him that he will provide an additional Rs 3.2 crore if he facilitated the fraudulent wire transfer. Police, who started the investigation, arrested the duo and also got in touch with the bank concerned and raised a request to stop the money transfer. Following the request, the bank has stopped the transaction and transferred the entire amount back to the company.

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