Bhansali is an ambitious man who emerges from the roots of modesty, orchestrating one of the boldest financial frauds of the 1990s. Within four years of the Harshad Mehta scandal, it exposed the vulnerability of India’s emerging non-bank financial sector.
Bhansali is from Sujangarh, Rajasthan, and was born into a modest jute trading family. In his hometown, he moved to Kolkata during a few uncomfortable years, where he became a chartered accountant before becoming a financial consultant.
His game plan
Despite some success, recognition avoided him and searched for green ranches, but he moved to Delhi in 1985 to form a CRB consultant. By 1992, the business had been transformed into CRB Capital Markets (CRB Caps), a limited entity that Bhansali moved its business to Mumbai. That was where he opened a CRB mutual fund and CRB shared custody services, weaving a complex network of 133 unlisted companies and subsidiaries to facilitate his plot.
His method of committing the crime (will both investors and savers carry a promise of high returns, not paid from real profits, but from the capital of new investors – not unique, nor the initial reaction of surrounding institutions. His company received an AAA rating from nursing, making it a credible atmosphere.
From 1992 to 1996, Bhansali’s various companies – CRB Capital Markets, CRB Mutual Funds through the Arihant Mangal Growth Program, a mature closed fund in 1999, and CRB Corporation Ltd, through its three public issues between May 1993 and December 1995 – almost raised ₹Rs 9 billion, attractive depositors have an annual yield of 24-32%.
His game plan centers on the fantasy of creating profitability. He therefore relocated funds through Shell through cross-holding share prices between private companies and public entities. Therefore, CRB Capital Market and CRB Shared Custody Services are the highest investments in CRB mutual funds.
Retail investors are few, as Bhansali basically lets his friends invest in his plans in exchange for stocks that buy stocks from their companies. He also used public lists of other companies, engineering deals, where stocks were bought at low prices, sold for high prices, and then bought back at exaggerated prices. These transactions are recorded as artificial profits in their public companies, which gives them a misleading image of financial health, which inflates their share prices and attracts more public investment.
The rating agencies are more encouraged and have received merciful support from auditors.
His ultimate ambition, however, is to secure a bank license. The mini scan in the middle is just a stone that steps onto this goal. For this, he sneaked ₹He cashed Rs 590 crore through fake accounts in Kolkata and Rajasthan from the Mumbai branch of the Indian Bank.
Surprisingly, the Reserve Bank of India (RBI) hosted Bhansali’s bank license. However, it didn’t give him one.
start
That didn’t suppress that man. He boldly released a prospectus for a group company’s private location, falsely claiming that “CRB Group has promoted its own private sector bank, CRB Global Bank Ltd, and soon began its commercial business.” So far, his net worth has grown to ₹43 billion, from ₹20 million five years ago, and his influence network spans top companies such as politicians, spiritual leaders and Arthur Andersen.
But to maintain high returns for depositors, he must keep the plan permanently moving, turning it into a high-risk game of financial juggling. The stock market crash in 1995, and within eight months, the BSE index fell 30%, proving to be his nemesis. Bhansali, desperate to blend his Ponzi scheme, ventured into risky businesses, including funding Bollywood movies and a golf resort project near the Delhi-Japur Expressway.
In December 1996, the Reserve Bank of India rejected the identity of CRB Bank and suspended his mutual fund business. Bhansali fled the country. In June 1997, CBI officials arrested him from Hong Kong and brought him back to India. The agency freezes the group’s bank accounts and submits a liquidation petition. Bhansali spent several months in prison in 1997.
He was beaten but not punished, and he retreated to Ghaziabad, reinventing himself as an educator and embracing the spiritual refuge often sought by white-collar criminals. He founded the Global Saraswati Consciousness Society (GSSCON) to spread the message of learning goddesses.
And the CRB scam is ₹By today’s standards, the Rs 12 billion is modest and it immediately made an impact, prompting the government to strengthen NBFC regulations by surveillance of the RBI. Not that this will stop the next liar.
