Dubai court freezes NMC founder Shetty’s assets
Injunction follows latest creditor move to recover funds from collapsed hospital operator
A Dubai court has issued a worldwide freezing order on the assets of NMC founder BR Shetty at the request of a Dutch bank, as creditors scramble to recover funds from the collapsed hospital operator.
Credit Europe Bank’s Dubai business has brought proceedings against NMC and Mr Shetty for non-payment of $8.4m in outstanding debt relating to a 2013 facility, according to recently unsealed court documents. It said roughly $25m in security cheques issued by Mr Shetty bounced.
The Indian entrepreneur argued he was not liable to repay because his signature in the lending agreements was forged and he never gave a personal guarantee or security cheques, the documents show — claims the bank disputed.
NMC was placed into administration in April as the healthcare group imploded amid accusations of fraud and the discovery of billions of dollars in unreported debt.
Mr Shetty has blamed the “serious fraud” on various former and current executives, claiming they used bank accounts in his name of which he had no knowledge.
The DIFC Courts’ injunction, issued in April, ordered Mr Shetty not to dispose of assets up to the value of $8.4m without the lender’s consent, pending resolution of the claim. But if Mr Shetty maintains that amount of unencumbered value within the Dubai International Financial Centre, he can sell other assets.
The order, which called on Mr Shetty to detail all his worldwide assets valued at more than $10,000, allows him to spend $7,000 a week on living expenses and “a reasonable sum” on legal advice and representation.
Credit Europe Bank Dubai, a trade and commodity finance specialist, referred to an accounting certificate placing Mr Shetty’s net wealth in May 2018 at $2.2bn after accounting for $120m in UAE loans.
The sum included $1.9bn in NMC shares, representing his then one-fifth stake that has since declined and is now likely to be worthless, along with $181m in UAE property, $121m of shares in his other companies and a luxury Mercedes car worth $885,000.
Europe Credit Bank did not respond to a request for comment. Lawyers for the parties were either unavailable or declined to comment. Mr Shetty and NMC’s administrators declined to comment.
The freezing order, made public months after it was implemented, complicates attempts by NMC’s administrators to keep the healthcare provider solvent during the pandemic.
Mr Shetty has also been hit with injunctions in Indian courts, including a claim for repayment from the Bank of Baroda.
Abu Dhabi Commercial Bank, which successfully pushed for NMC to go into administration, has also filed a criminal complaint in the UAE capital against several parties it claims were involved in the alleged fraud.
“One process would be easier,” said one person involved in the administration. “The various civil and criminal claims from banks muddy the waters.”