Credential Finance (CFL), a financial services firm set up by brothers Deepak and Rajiv Kochhar in the mid-1990s, failed to repay its loans taken from financial institutions, including Sicom and a State Bank of India subsidiary.
The Central Bureau of Investigation (CBI) is currently investigating CFL along with NuPower Renewables and Avista Advisory Group for alleged conflict of interest.
ICICI Bank gave a Rs 32-billion loan to Videocon group, which invested in NuPower Renewables, a firm promoted by ICICI Bank MD and CEO Chanda Kochhar’s husband Deepak Kochhar.
According to filings with the courts and with Ministry of Corporate Affairs, CFL failed to repay its dues in time.
In 1995, CFL merged with Bloom Field Builders, and Chanda Kochhar held shares in the company.
The name of the company was changed from Bloom Field Builders to Credential Finance and Deepak Kochhar took over as managing director, while his brother Rajiv was appointed executive director.
The company also appointed Manoj Maheshwari, OP Bhardwaj, T Thyagarajan and SK Shelgikar as additional directors, according to filings with the Registrar of Companies (RoC).
The company’s paid-up share capital increased from Rs 1 crore to Rs 5.6 crore, and it started its business as a non-banking finance company.
The company planned to set up offices in Dubai, Singapore and London to raise deposits from non-resident Indians, even as it raised fixed deposits worth Rs 3.6 crore from the Indian public as on March 1996.
According to RoC filings, by 2001, Videocon owned 17 per cent stake in Credential Finance, while the Kochhar family owned 2 per cent stake directly along with a host of investment companies.