Yes Bank co-founder Rana Kapoor forced to buy a painting from Congress: FATF's Case Study

In a massive embarrassment for Congress, the Financial Action Task Force (FATF) released a case study on Yes Bank founder Rana Kapoor in which it is claimed that he obtained awards and accolades inappropriately by purchasing a "mediocre" painting from Congress.

 

The case study titled ‘Purchase Art with Illicit Proceeds and Use Art of No Value to Pay Kickbacks’, indirectly referred Rana Kapoor as “Mr A” and accused him of misusing his position during his tenure.

 

According to the study, “Mr A” purchased a piece of art for USD 264,000 from a close relative of a previous ruling party, which held no significant value.

 

“A money laundering investigation revealed that Mr A used his influence to sanction the loan to a loss-incurring entity, Company B. Investigations further revealed that Company B diverted the loan to 79 shell companies including Company C, which was controlled and owned by Mr A and his daughters. Company C received USD 79 million and used part of the funds to purchase assets including art from famous painters and influential people. Mr A invested a significant amount of proceeds in buying the art of famous artists. Investigations revealed that he had purchased around 44 paintings,” the case study said.

 

 

Further, it said, "Mr A had received awards and accolades from several organisations in inappropriate ways. Investigation revealed that, in order to pay kickbacks for receiving awards, Mr. A purchased mediocre art from politicians and in turn paid huge kickbacks through banking channels, projecting them as genuine pieces of art. In one such incident, Mr. A purchased a piece of art from a close relative of a member of the ruling political party at that time for USD 264000. However, the investigation revealed that this was an over-valuation, and that the price paid was not for art, but rather was a bribe to influence the awarding of the prestigious Indian award ‘Padma Bhushan’ for himself."

 

As per his statement given to the Enforcement Directorate (ED) which was a part of the second supplementary charge sheet filed before a special court in Mumbai, Rana had alleged that he was forced to puy a painting from then ruling party in 2010.

 

Kapoor was arrested by the ED on March 8, 2020. He is accused of sanctioning loans worth USD 628 million to business entities incurring losses or with negative credit, deliberately violating existing norms and regulations.