SECRET GLOBAL BINAMI EMPIRE OF CHIDU AND CO

The New Indian Express had exposed Vasan Eye Care, Karti Chidambaram and P Chidambaram in a series of articles in September and October last. The government began acting a trifle late in December last. It raided Karti. But, both the Chidambarams have been escaping the facts by repeatedly lying that their family has nothing to do with the exposed companies and pretending to be political victims.

Now, the New Indian Express has unearthed a devastating piece of evidence, which nails forever the lies of the father and son duo that Advantage Strategic Consulting Private Limited (Advantage), which has amassed huge wealth in India and in different countries, belongs not to them or their family, but to their friends. The new evidence proves that Advantage, which holds properties worth several hundreds, perhaps even thousands, of crores, may be even more, in India and outside, belongs to the Chidambaram family but held in benami names.

Advantage is the ‘smoking gun’ in this case.

Despite being all modern, save the traditional dhoti they wear, the Chidambarams have adopted only the age-old, but tested, benami structure to hide their ill-gotten wealth in the names of persons who lend names as cover for them, like all politicians who accumulate illicit wealth do. Recently, in the infamous Adarsh society case, the Bombay High Court directed the prosecution of bureaucrats and politicians who held flats in the society in their benamis’ names, under the anti-benami law. Benami deals are not easy to prove as they are based on secret trust between the benamis and the real owner, leaving no need for documentation. But obviously Karti would not trust his benamis. Result, he ended up documenting his benami deals by getting his benamis execute Wills saying that after their lifetime, the shares of Advantage, which holds the global and local empire of his family, will go to his daughter. He had kept the Wills executed by them with himself. And that is now the proof against him. Wait a while for the interesting and intriguing details of the Wills.

How did the Wills, which will see the light of the day only on the death of the person writing it, come out? Joint raids conducted by Income Tax and Enforcement wings of the government four months back, in December last, on Karti had unearthed the Wills from his vault. Since the Wills have been recovered from him, they constitute evidence against him in law. Copies of the Wills have been obtained by The New Indian Express through confidential sources. How the ownership of Advantage and its global wealth is held through benamis of Chidambarams’ family who have executed Wills is demonstrated in sidebars. They show the relevant parts of the four Wills. Both together bring out the illegitimate financial empire of the family.

 

Indian Wealth

The first thing to recall from earlier articles in this paper is that Karti owned two-thirds of Advantage through the latter’s holding company, Ausbridge, in 2011, which he has in fact admitted. Later, the ownership of Advantage was shown in the names of his benamis who have willed it back to his daughter now. Look at the wealth Advantage holds in India.

Advantage India holds 90,000 out of the 1.5 lakh equity shares of Vasan Eye Care it got at a throwaway price of Rs 100 per share, of which it actually paid only one-third, that is Rs 33 per share.

It sold away 60,000 out of the 1.5 lakh shares to Sequoia Capital Investments, a Mauritius-based investment fund, in two tranches of 30,000 shares each. In the first tranche, Advantage sold the 30,000 shares at Rs 7,500 per share, that is for Rs 22.5 cr. Assuming the next tranche too was sold at that price, and the balance 90,000 shares are valued at that price, the Vasan Eye Care part of the wealth alone would be Rs 112.5 cr, to acquire which Advantage paid only – believe it – Rs 50 lakh! Sequoia was raided by Enforcement Directorate on April 16, 2016, for its alleged complicity with Karti. Advantage India has also had dealings with a large number of domestic and foreign corporates who had borrowed heavily from Indian banks or had had repayment problems.

 

Global Empire

Now look at the wealth Advantage India through its subsidiary Advantage Strategic Consulting Pte Singapore (Advantage Singapore) holds outside India. The joint raids by Enforcement and Income Tax department uncovered, besides the Wills, incriminating documents that brought to light the huge empire of several hundreds of crores built in the name of Advantage in London, Dubai, South Africa, Philippines, Thailand, Singapore, Malaysia, Sri Lanka, British Virgin Island, France, USA, Switzerland, Greece and Spain. Karti seems to have left out only Antarctica (See box). The Enforcement sleuths have found that global deals had been executed through Advantage Singapore. They have related the massive wealth build up to the period when Chidambaram was Finance Minister and Home Minister. The sleuths have also unearthed documents, including the acquisition papers of Advantage Singapore and a Sri Lankan firm; money trail of investments made in the Sri Lanka-based financial firm; proofs of transactions in Dollars and Euro; payment details amounting to more than Rs 30 crore in foreign currencies. These details have been reportedly submitted in a sealed cover to the Supreme Court, which is monitoring the Aircel-Maxis case, and shared with the CBI.

Chidambaram family benamis

See how Advantage India’s ownership is buried in the names of benamis. Out of Advantage India’s total capital of five lakh equity shares, two lakh shares (40% ownership) is now held by Ausbridge, which was almost entirely owned by Karti from 2006 to 2011. Karti transferred his ownership of Ausbridge to Mohanan Rajesh, his neighbour, in 2011 to dissociate himself from Advantage, which had come to media attention thanks to its Vasan link. Interestingly, Karti took the shares of Ausbridge from Mohanan Rajesh in 2006 and gave it back along with his own to him in 2011! Obviously Mohanan Rajesh is the name lender for Karti – he gives the shares to Karti and takes it back as per Karti’s wish and needs.

The balance three lakh shares (or 60% ownership) of Advantage is held in the names of four benamis – CBN Reddy, known as Karti’s sidekick (2,11,430 shares), Padma Viswanathan and Ravi Viswanathan (32,600 shares) and Bhaskararaman (17,400 shares), Karti’s other nominees. The four have executed Wills bequeathing – that is giving – the full 60% ownership of Advantage India to Chidambaram’s grand daughter and Karti’s daughter, Aditi Nalini Chidambaram. As Advantage India fully owns Advantage Singapore, the bequest to Aditi implicitly includes the global wealth held by the latter.

See how the Wills have been executed. All Wills have been uniformly executed on the same day – 19th June 2013, identical in language and content. In three of them, the first witness is CBN Reddy. In CBN Reddy’s Will, it is Ravi Viswanathan. The second witness for all four Wills is one V Murali. All Wills divide the properties into two parts. One, the Will writer’s personal assets, and the other, the benami shares in Advantage and other companies. They bequeath their personal properties to their spouse and children. They gift away the benami shares worth hundreds of crores of rupees not to their children, or to any charity or poor, but to Chidambaram’s family, symbolically in the family grand daughter’s name. Why do they bequeath such massive wealth to Chidambaram family, which is unrelated to them? Take what the biggest donor to the family, CBN Reddy, who willed over 42% of the global empire held by Advantage India and the Singapore twins to them, says. He claims in his Will that late Dr B Rangarajan – Karti’s father in law – was his ‘friend, philosopher and guide’ to whose family, he felt, “deeply indebted”. As a token of his “love” for Rangarajan’s “family”, Reddy says, he has bequeathed to Rangarajan’s beloved grand daughter and daughter of Srinidhi all his shares in three companies listed by him, namely, Advantage (2,11,430 shares), Kriya FMCG (22,500 shares) and Rochester Technology Solutions P Ltd (5,000 shares). A note on Kriya FMCG (which in turn holds 38,570 shares in Advantage). It was originally owned by Srinidhi and Aditi, who held its entire capital of 22,500 shares. They had transferred it in its entirety to CBN Reddy in 2008. And in 2013 Reddy Wills them back to Aditi! Why did Karti’s wife and daughter transfer their shares to Reddy and get it bequeathed back? Obviously to distance Advantage from the Chidambarams openly and get it back secretly. Only Karti can answer.

Why did the other three make Wills in favour of the Chidambaram family? Ravi Viswanathan repeats the “friend, philosopher and guide” formulation of CBN Reddy. Bhaskararaman and Padma Viswanathan say they “recognise the contribution made” by Dr Rangarajan to their “life, which is immeasurable”. All Wills systematically avoid mentioning the names of Chidambaram as grandfather and Karti as father of Aditi and mention only the beneficiary Aditi’s maternal grandfather and mother. But who did the four persons choose as the all important Executor of the Wills if they die? Any guess? It is Karti. Why? In law, once the person executing the Will dies, Karti as the Executor will step into his or her shoes, so that no one else can fiddle with the benami shares. Does it need a seer to say that the four persons who have given the Wills to Karti are just benamis for the Chidambaram family?

 

Will PC stop lying?

But the senior and junior Chidambarams have been lying on these benamis and projecting them as true owners in their statements to the media from time to time. Karti said as recently as last month, after the media exposed his global empire, that Advantage “was incorporated by the people I know. I came into the company with a friend and left, briefly,” adding, “I am not a shareholder or a director of Advantage. Advantage is owned by my friends, who I know very well.” What a blatant lie. In his statement issued simultaneously, the senior Chidambaram denied that his son had any interest in the firm and said, “If the government wishes to target me, they should do so directly, not harass friends of my son who carry on their own businesses and have nothing to do with politics.” He accused the government of “malicious onslaught” against his family. Just friends of your son Mr Chidambaram? Not his and your family’s benamis? Their own business? Not your family’s? Malicious onslaught by government? Chidambaram has been lying on the ownership of Advantage and Vasans since 2008 when the Economic Times first exposed Karti’s links with Advantage. Will he stop lying from now and deal with the facts that are out in the public domain?

Remember Chidambaram’s threat on September 21, 2015 to sue The New Indian Express? He did not even dare sue this paper. Why didn’t he do it, despite the paper welcoming it? Because he knows what the truth is.

 

Karti’s Global Footprint

Advantage Singapore’s global empire extends to several countries. The Enforcement sleuths have unearthed that Advantage Singapore

■ Had acquired 88 acres in Sept 2011 (through the tax haven British Virgin Island [BVI] company Somerset Surridge Ltd) at Surridge Farm in Somerset in the UK for ₤1 million

■ Bought a company, Artevea Digital Ltd, in Cambridge

■ Has had transactions with Oppenheimer Investments (UK) Ltd

■ Bought majority stakes in Lanka Fortune Residencies, which owns the prestigious ‘The Waterfront’, ‘Weligama Bay Resort’ and Emerald Bay Hotel

■ Routed money via Dubai to acquire three farms and vineyards in South Africa

■ Had money transactions with Nicholls Steyn and Associates in South Africa

■ Got investments from Dubai-based Desert Dunes Properties Ltd involving money trail of $1.7 million (Singapore) between these firms

■ Had dealings with Pearl Dubai FX LLC

■ Has joint ventures with two companies in Philippines and allied with Juna Kevin and Haresh C Hiranand, Philippines, to obtain a franchise team of International Premier Tennis League (Asia)

■ Had financial transactions with Real Beyond Pte Ltd, a Singapore Realty company, which has three subsidiaries in Malaysia

■ Made 16 land purchases in Thailand

■ Invested $400,000 (Singapore) in Full Innovations Ltd, a BVI firm

■ Has had financial dealing with Geben Trading Limited in BVI with offices in Switzerland, through the Swiss Bank, UBS — which was involved in the famous Hasan Ali scam in India

■ Has had a transaction of $5 million (Singapore) with Unison Global Investment Ltd, Singapore

■ Entered into joint ventures with Gravitas Investments, Match Point International Tennis Events to buy a franchise tennis team called ‘Manila Mavericks’, for $12 million payable in 12 instalments

■ Acquired residential flat in Malaysia worth 1.9 million Malaysian ringgits from a firm called Peninsular Smart

■ Holds franchise of Café’ Coffee Day in some areas of Malaysia and has had several transactions with Malaysian companies

■ Opened a subsidiary firm in Barcelona in Spain, Advantage Estrategia Esportiva SLU, in August 2012, which is a sports academy on four acres with seven tennis courts

■ Has also made $1 million investments in France in Pampelonn Organisation

■ Has had transactions with a Greek firm, Pisani John Sakellarios in Athens

■ Has also transferred $50,000 to an account in the name of “Chennai Reserve – Business Advantage Checking” in Bank of America account — the beneficiary of this transaction being Kitchen Inc, a Delaware Corporation company in New York engaged in issuance of Convertible Promissory Notes — obviously illicit cross border financial product

■ This list is illustrative and not exhaustive

This Article Was Originally Published by Mr Gurumurthy in the New Indian Express 

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