The legal aftershocks of the NMC Healthcare collapse have reached a historic high point as founder B.R. Shetty launches a $15 billion civil lawsuit against India’s state-run Bank of Baroda and 25 associated parties at the Bombay High Court.
Once a celebrated titan of Middle Eastern healthcare and financial services, the 84-year-old businessman claims that the public sector bank acted as an active enabler in the fraudulent schemes that dismantled his business legacy.
The Core Allegations: How the Misconduct Unfolded
Represented by his attorney, Dr. Shishir Shetty, the lawsuit presents a damning account of institutional compliance failure. The legal filings center on four major operational breakdowns involving Bank of Baroda across operations linked to NMC Healthcare, Neopharma, and UAE Exchange:
Ignored Red Flags: The bank allegedly overlooked automated and manual Anti-Money Laundering (AML) warnings regarding unusual transaction flows.
Circular Fund Transfers: Unchecked transactions between affiliated companies allowed perpetrators to artificially inflate balance sheets while concealing actual debt levels.
Sham Supplier Network: The claim asserts that accounts were opened for fraudulent vendors specifically to route diverted funds away from core operating companies.
Forged Personal Guarantees: Shetty alleges his signature was forged on critical financial instruments, making him liable for billions in unapproved corporate debt.
The Role of Former Insiders
The lawsuit targets former key executives, placing former CEO Prasanth Manghat and his brother Promoth Manghat at the heart of the alleged conspiracy. According to Shetty, collusion between former management and banking insiders allowed complex financial manipulation to proceed without executive oversight or board awareness.
High Stakes for State-Owned Banking
By demanding $15 billion in compensation, Shetty’s legal team is putting Bank of Baroda’s international compliance oversight under intense judicial scrutiny. While specific details on secondary remedies have not been publicly disclosed, the case brings critical questions around public sector banking oversight and cross-border financial governance back into the spotight.
Bank of Baroda has yet to issue an official statement or file a formal counter-response with the court. As legal proceedings commence in Mumbai, all charges against the bank and named individuals remain unproven claims pending court evaluation.
