In short: BR Shetty, founder of UAE-based NMC Healthcare, has filed a commercial suit in the Bombay High Court claiming over $15 billion from Bank of Baroda and others. He alleges the bank helped carry out a fraud against him. The bank says it has not been served and will defend the suit firmly if it is. None of the allegations has been tested in court.
What has happened?
Shetty, who founded NMC Healthcare and UAE Exchange, has filed Dr BR Shetty v. Bank of Baroda & Ors. in the Bombay High Court. He is claiming damages of more than $15 billion, which Bar & Bench puts at roughly ₹1.43 lakh crore. The suit was filed through his power of attorney holder. Reuters, as cited by India Today, reports that the bank and 25 other defendants are named. Bar & Bench says they include bank officers and two former NMC executives.
It said it had not been served with the suit and could not comment on pleadings that are untested in court. It added that, if and when it is served, it will defend the suit firmly and take all steps needed to protect its interests.
What does Shetty allege?
These are claims made in the suit. They are not findings by any court.
- Loss of control: He says he stepped back from daily operations between 2012 and 2017 to pursue philanthropy. He alleges the two former executives then took charge of company finances and siphoned funds through sham supplier entities.
- Copied signature: He claims his signature was copied from an electronic template onto loan guarantees without his consent.
- Round-tripping: He alleges bank officials set up accounts for sham suppliers and moved money in circles to make the company look profitable.
- Ignored warnings: He says the bank ignored over 100 internal anti-money laundering alerts.
- Gifts and concealed debt: He alleges bank officials accepted gifts, including luxury electronics and a Rolex watch. He also alleges the bank split balance confirmation certificates to hide nearly AED 980 million ($250 million) of debt from auditors Ernst & Young.
- Aftermath: He says the bank made him a scapegoat by submitting false returns to the Reserve Bank of India. He also says it maliciously obtained a Look Out Circular that kept him in India for over three years, until the Karnataka High Court quashed it.
How is the $15 billion made up?
| Head of claim | Amount | Basis |
|---|---|---|
| Direct damages | $5 billion | Lost shareholdings and enforced liabilities |
| Consequential damages | $5 billion | Lost business opportunities and income |
| Reputational loss | $5 billion | Claimed against Bank of Baroda alone |
The Economic Times also reports that he seeks 18% interest on the first $10 billion.
The background: the UAE settlement and recovery action
The suit follows a settlement in the UAE. Bank of Baroda agreed to pay about $600 million (roughly ₹5,700 crore) to settle claims by the administrators of NMC and its affiliates. Those administrators had accused the bank of facilitating improper transactions without proper due diligence, anti-money-laundering and customer verification checks. Shetty's suit says the bank still pursues him on the same underlying guarantees.
The bank says it is pursuing recovery and enforcement proceedings in India and the UAE against Shetty over dues of ₹28 billion ($294.57 million). It also says it has obtained several decrees against him. Separately, NMC Health was placed under administration in 2020 and later disclosed debts of $6.6 billion, against earlier estimates of $2.1 billion.
What does it mean legally?
This is a civil claim for money, not a criminal case. At this stage there is only a plaintiff's version, and the court has not ruled on any allegation. The bank says it faces no immediate liability unless an order is passed against it or it must make a provision for potential damages. Once the bank is served, it can file its response and contest the claims. The recovery decrees the bank mentions are a separate track.
Markets reacted. The Economic Times reported that Bank of Baroda shares fell more than 3% on Wednesday, to ₹230.40 on the NSE.
Who is affected, and what should readers do?
The parties directly affected are Shetty, the bank, and the other named defendants. Ordinary bank customers need to take no action. Readers who follow the stock should rely on the bank's official exchange filings and court records rather than on reports of allegations. This article is not investment advice. We will update it as the matter develops.
Frequently asked questions
Has the court found Bank of Baroda guilty of anything?
No. The suit only contains Shetty's allegations, and the bank says they are untested in court. No court has ruled on them.
How is this connected to the $600 million settlement?
The bank agreed to pay about $600 million to NMC's administrators in the UAE. Shetty's suit points to that settlement and says the bank still pursues him on the same guarantees. The bank, for its part, says it is pursuing recovery of its dues from him.
Sources
- Bar & Bench: NMC founder BR Shetty files $15 billion suit in Bombay High Court against Bank of Baroda
- ET Markets: Bank of Baroda shares drop 3% after NMC Healthcare founder BR Shetty files $15 bn lawsuit; lender issues clarification
- India Today: Bank of Baroda to defend $15 billion lawsuit by NMC Health founder BR Shetty