Rags to riches stories of millionaires and billionaires are often an inspiration to a large population. However, on the flip side, India also a lot of riches to rags stories. Over the decades, there have several billionaires, millionaires in the country who have gone bankrupt. The stories of the billionaires is also a lesson for people that one small mistake and erase your entire life’s effort and can wipe out your wealth leaving you bankrupt.
Here are 7 Indian billionaires who went from Riches to Rags:
1. Vijay Mallya: Absconding liquor baron Vijaya Mallya, also known as the king of good times, was once a rich Indian businessman. The former Rajya Sabha MP and former owner of an IPL franchise, Mallya had ventured into new fields, be it sports, politics or the now-defunct Kingfisher airlines. A consortium of 17 Indian banks led by the State Bank of India (SBI) is pursuing bankruptcy order Mallya in the High Court in the UK.
The consortium is trying to collect approximately Rs 9,000 crore ($1.3 billion) in loans which Mallya has allegedly routed in order to gain 100% or a partial stake in about 40 companies across the world. Recently, the consortium told the Supreme Court that around Rs 3,600 crore has been recovered from Mallya. Senior Advocate Mukul Rohatgi informed the top court that Rs 11,000 crore is still pending to be recovered from Mallya and UBHL.
Mallya, who has been based in the United Kingdom since March 2016, is wanted back in India under charges of financial fraud. In January 2019, a special Prevention of Money-Laundering Act (PMLA) court had declared him a ‘fugitive economic offender’.
2. Mehul Choksi: Gitanjali group owner Mehul Choksi fled the country after defrauding Punjab National Bank with this nephew Nirav Modi. The fugitive businessman is currently living in the island nation of Antigua and Barbuda and is wanted by the Indian authorities for criminal conspiracies, breach of trust and money laundering.
Choksi was the owner of Gitanjali Group, a retail jewellery company with around 4,000 stores in India. Choksi is suspected of colluding with two employees of PNB, the country’s second-largest state-owned lender, in an alleged $1.8 billion fraud.
A designated PMLA authority, in 2018, held that 41 properties worth about Rs 1,210 crore, attached by the ED in the name of Mehul Choksi and his associated firms, are money laundering assets and ordered that their attachment should continue.
3. Ramalinga Raju: Bank in the 90s when the IT industry was starting to bloom in the country, Satyam Computers used to be a highly successful IT firm which ultimately collapsed and shut down in 2015. Among many reasons for the collapse was the former Satyam Computer Services Chairman and CEO Ramalinga Raju.
Raju stepped down from his role after he admitted that he embezzled the company of Rs 7,140 crore. Raju resigned from the Satyam board after the Satyam Scandal broke out and he admitted to falsifying revenues, margins and over Rs 5,000 crore of cash balances of the company.
Raju confessed to accounting fraud to the tune of Rs 7,000 crore or $1.5 billion and resigned from the Satyam board the same year in January. Satyam was then purchased by Tech Mahindra and was renamed Mahindra Satyam. Within a month of being convicted, Raju and all others who were found guilty in the fraud were granted bail by a special court in Hyderabad. The bail amount for R. Raju and his brother was set at Rs 1 lakh and the other convicts were set at Rs 50,000.
4. Nirav Modi: Firestar Diamond owner Nirav Modi, who is wanted by the Interpol and the Indian government for criminal conspiracy, corruption, money laundering, fraud and breach of contract since August 2018, is currently in a London jail. The fugitive diamantaire is being investigated in a $2 billion fraud case of Punjab National Bank.
After PNB filed a complaint against Modi and his partners for defrauding the bank of Rs 28,000 crore, CBI registered a case against the businessman and the ED started investigating him. Modi has also been sued by a California-based entrepreneur for $4.2 million over two custom diamond engagement rings which turned out to be lab diamonds.
5. Subrata Roy: When it comes to scams, Sahara India is one of the biggest scams known to the Indian population. The Sahara scam, also known as Sahara chit fund scam, is one of the biggest corporate scams in India. Subrata Roy who is the managing worker and Chairman of Sahara India Pariwar had a run-in with the law enforcement agencies back in 2014.
On 26 February 2014, the Supreme Court of India ordered the detention of Roy for failing to appear before it in connection with a legal dispute with Market Regulator – SEBI. Roy was held in custody in the Tihar Jail, Delhi and is now out on parole since May 2016.
Since then Roy has been successful in getting his bail extended on various grounds. As of 31 January 2019, Sahara still had to pay Rs 10,621 crore to meet its total liability.
6. VG Siddhartha: India’s biggest coffee chain Cafe Coffee Day founder VG Siddhartha was known as one of the most successful businessmen in the country. The Coffee King shocked the nation when he allegedly committed suicide last year. After going missing on the evening of 29th July 2019, his body was found at Hoige Bazaar beach on 31st July.
Before jumping off a bridge into a river in an apparent suicide, he had penned a letter that spoke of pressure from lenders, a private equity firm and harassment by tax officials. Note that on 21 September 2017, a tax raid was conducted at more than 20 of Siddhartha’s locations in Mumbai, Bengaluru, Chennai, and Chikmagalur by senior officers of the Income Tax Department of Karnataka and Goa regions.
7. Anil Ambani: Reliance Communication chairman Anil Ambani was once India’s richest man. In fact, at one point, Anil’s net worth was way higher than his brother Mukesh Ambani. In 2008, Anil was named the sixth-richest person in the world by Forbes which pegged his wealth at $42 billion.
Once counted among the world’s richest with a net worth of $42 billion, Anil Ambani, earlier in February this year told a UK court that his net worth was zero and his family won’t support him when “push comes to shove”.
The Chairman of the Reliance Group had a close shave with jail time in March before RIL Chairman Mukesh Ambani bailed him out at the last minute. The woes of the ex-billionaire came to the fore when Supreme asked him to pay Ericsson AB’s India unit about $77 million of past dues or go to jail since Anil Ambani had given a personal guarantee.
Anil Ambani has been fending off creditors and fighting multiple cases in courts amid his Reliance Communications Ltd. sliding into bankruptcy. ( TN )