Global Lenders Seek to Recover Hundreds of Millions After Alleged Fraud by Indian Entrepreneur Bankim Brahmbhatt
BlackRock’s private-credit unit, HPS Investment Partners, and several global lenders are seeking to recover hundreds of millions of dollars after allegedly being defrauded by Indian entrepreneur Bankim Brahmbhatt, according toThe Wall Street Journal.Brahmbhatt, founder of Broadband Telecom and Bridgevoice, is accused of fabricating telecom assets and invoices to secure more than $500 million in loans from international financiers.Who is Bankim Brahmbhatt?Brahmbhatt, a long-time figure in the international telecom services industry, built his reputation through companies that facilitated wholesale voice and data traffic between global carriers. His ventures operated across the US, Europe, and Asia, projecting themselves as reliable intermediaries in global telecom infrastructure.Before the scandal, Brahmbhatt was regarded as a successful non-resident Indian (NRI) businessman with offices in Garden City, New York, and links to investment entities Carriox Capital II and BB Capital SPV.Allegations of a multi-year fraudAccording to court filings by HPS and other lenders, Brahmbhatt and his companies created fake invoices, forged emails, and fabricated contracts to obtain loans. The fraud involved asset-based financing, where future customer payments are pledged as collateral.Also ReadSC seeks CBI's response on bail plea of former DHFL promoter Kapil WadhawanGovt looks to address gaps used to illegally transfer forex overseasED raids Sasikala, others in ₹200 cr bank fraud, benami assets probeShilpa Shetty's restaurant Bastian Bandra to close amid ₹60 cr fraud caseAuditor flags ₹63 crore as potentially fraudulent in HNG transactionsInvestigators allege that the companies even built fake websites resembling legitimate telecom clients to mislead auditors and lenders. Further checks revealed that every email used to verify invoices in the past two years was fake, and falsified documents dated back to 2018.How the scheme was uncoveredThe fraud came to light in July 2024, when an HPS employee spotted irregularities in customer email addresses during an audit. Upon cross-verification, major Belgian telecom company BICS confirmed it had no dealings with Bridgevoice, describing the emails as a “confirmed fraud attempt.”Subsequent investigation by Deloitte and CBIZ confirmed that the customer data, invoices, and contracts were fabricated, exposing a sophisticated, multi-year deception.Brahmbhatt files for bankruptcyAfter being confronted by lenders, Brahmbhatt reportedly stopped responding to calls and emails. Investigators visiting his New York offices found them locked and deserted, with his home abandoned and several luxury cars left outside.Sources cited byThe Wall Street Journalsaid Brahmbhatt may have relocated to India or Mauritius.By August 2024, his companies — Broadband Telecom, Bridgevoice, Carriox Capital II, and BB Capital SPV — had all filed for bankruptcy, followed by Brahmbhatt’s personal bankruptcy on August 12, 2024.HPS’s exposure reportedly rose from $385 million in 2021 to $430 million by the time of the collapse. BNP Paribas, a co-financier, is said to have set aside $220 million in provisions linked to the case.Brahmbhatt’s lawyer has denied wrongdoing, calling the allegations “misplaced” and maintaining that the business was legitimate.Fallout for BlackRock and lendersAlthough the alleged fraud involves over half a billion dollars, the impact on BlackRock’s balance sheet is considered limited. HPS manages about $179 billion in assets, making the potential loss “manageable,” the report said.However, the incident has triggered a review of due diligence and verification processes across BlackRock’s private-credit portfolio, as lenders reassess safeguards around asset-backed loans.
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