How a real estate tycoon’s lifestyle crushed PMC Bank

One man’s fault becomes another’s lesson. In this case, there are many in a frenzied emotional state, who have learnt their biggest lesson by depositing their savings with PMC Bank. Amidst festivities and celebrations, their only wish is to get the money back.

Amol Dethe
  • Published On Oct 18, 2019 at 07:55 AM IST
Read by: 100 Industry Professionals
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Bandra. A shopper’s paradise and home to Bollywood biggies on the west side of the railway station is not the same on the east side. Immediately, starting from the railway tracks of Bandra station, begins the Garibnagar slum, where thousands of poor dwell. Amid the normal hustle and bustle stands is a glossy building merely 500 meters away — with sleek glasses, clean and cozy lobby. The building belongs to HDIL.

For the first time I entered this building was in the year 2010. While I was entering, I saw a luxurious car in the lobby. I am not an automobile fan but that car caught my attention. It was so well maintained that for a second I thought if it were there for an exhibition. The logo of the car had black and red stripes with a prancing stallion. Yes, it was a Porsche. Owned by Sarang Wadhawan or Sunny Dewan, MD of Housing Development and Infrastructure Ltd (HDIL).

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In his posh cabin, I interviewed Sunny on the Maharashtra government’s CESS ruling. He answered my questions and we wrapped up the interview without discussing any other affairs. I managed to steal a glance of the magnificent Porsche before leaving the premises.

It is ironic that the man who owned luxurious cars and was famous for his lifestyle made money from Slum Rehabilitation Projects. Many real estate consultants would say that no other builders would bother to apply for SRA as they knew how well connected HDIL’ were with the people who awarded these projects. The bond of Wadhavan and government officers was so strong that Wadhavan could park his car at the VIP parking lot of Maharashtra Housing Development Authority, MHADA office.

Apart from the MHADA and government offices, Sunny’s luxurious cars were also parked at many Bollywood biggies’ houses. And he had enough to impress Bollywood stars who had it all… including Hummer, Land Rover, Bentley, Rolls-Royces, Phantom, Lamborghini, Ferrari.

Sunny has a private jet, private yacht and more than a dozen horses that are in the stable of Mahalaxmi Race course. Like his imported cars, jet, yacht and his bodyguards, too, were imported. Wadhawan’s large villa at Alibaug beach is often used for corporate and Bollywood parties. He has bungalows in Lonavala and a few other countries.

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Wadhawans have their own style of celebrating special events. Industry sources say, on the first birthday of his daughter he flew in Chinese circus to India. Bollywood biggies attended this circus with their children.

In the last 42 years, Wadhavan may have driven many luxury cars and built the brand more strongly than the buildings, but at what cost? Who paid for it?

The problem in India is the banks. They have disbursed thousands of crores merely on a phone call because of the strong nexus between politicians and business houses. And the sufferers are those who die everyday only because they trusted the banks, the system, and the political parties. But their trust has no weightage. Their presence doesn’t matter. It's been more than one month since the PMC Bank fiasco. A few depositors have already lost their lives over their money and the remaining have no idea whether they will ever get their money back.

The state where this incident happened is going for an election next week so the government can't make any comment. Finance minister has offered sympathy and Reserve Bank Of India (RBI) is still evaluating what went wrong and what can be done.

HDIL, the company responsible for the crash of Punjab and Maharashtra Co-Operative Bank, is trading at Rs 2.24 today and the current market cap is Rs 106.18 crore. And the borrowing is more than 100 times. CEO of PMC bank has already confessed that Wadhawan has threatened the Bank. He could do that because he had borrowed enough. When will such borrowers stop dictating terms to bankers. And when will bankers stop serving such borrowers?

Wadhawans — father & son — have been arrested and the investigation is on. But the jilted PMC depositors won’t be able to celebrate Diwali because they have paid for Wadhawans' parties and cars.

  • Published On Oct 18, 2019 at 07:55 AM IST
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