Global investment firm BlackRock's private-credit investing arm and several major lenders are now scrambling to recover more than $500 million lost in a loan fraud allegedly orchestrated by Indian-origin telecom executive Bankim Brahmbhatt.
American investment giant BlackRock has reportedly fallen victim to a staggering multimillion-dollar fraud allegedly engineered by Bankim Brahmbhatt, the Indian-origin CEO of Broadband Telecom and Bridgevoice, both US-based telecom entities. According to The Wall Street Journal, lenders have accused Brahmbhatt of fabricating accounts receivable that were used as loan collateral, leaving his companies owing more than $500 million.
Brahmbhatt’s lawyer told the Journal that the CEO disputed the fraud allegations.
BlackRock’s private credit investment arm, HPS Investment Partners, reportedly began lending to one of Brahmbhatt’s financial arms in September 2020, initially investing a few hundred million dollars before ramping up its exposure to $385 million in early 2021, and then $430 million by August 2024.
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The alleged fraud began to unravel when, in July, an HPS employee discovered that several customer email addresses appeared to originate from fake domains mimicking real telecom companies. When confronted, Brahmbhatt brushed off the concerns, assuring there was “nothing to worry about,” and soon after, ceased all communication.
An HPS official later visited Brahmbhatt’s New York offices, only to find them shuttered. By August, the telecom firms under his control had filed for bankruptcy, deepening the mystery.
Where Is Bankim Brahmbhatt?
When The Wall Street Journal visited Brahmbhatt’s Garden City residence, the house appeared eerily deserted. “Two BMWs, a Porsche, a Tesla and an Audi were parked in the driveway. A package next to the front door was collecting dust,” the report noted.
HPS officials reportedly told clients they believe Brahmbhatt is in India. “Calls to Brahmbhatt’s lawyer seeking comment on his client’s whereabouts weren’t immediately returned,” the Journal stated.
In a lawsuit filed in August, the lenders claimed that an investigation into the customer emails Brahmbhatt’s companies had provided revealed each one was fake. “Brahmbhatt created an elaborate balance sheet of assets that existed only on paper,” lawyers for the lenders wrote.
They further alleged that Brahmbhatt diverted assets which were meant to serve as collateral into offshore accounts in India and Mauritius, intensifying suspicions of a cross-border financial deception that fooled even seasoned investors.