Force India F1 Owner Vijay Mallya Funded Team With Fraudulent Loans, Lawyer Says
Vijay Mallya "dishonestly" used bank loans to fund his Formula 1 racing team and a private jet, a lawyer for Indian prosecutors said while "urging a London court to extradite the Kingfisher Airlines Ltd. founder to face fraud and money-laundering charges," according to Ring & Wild of BLOOMBERG. India wants the booze and motor-racing tycoon "for a trial for allegedly defaulting on a series of loans from the state-owned IDBI Bank Ltd. for his failing airline that were obtained under false pretenses." The 61-year-old "deliberately provided worthless collateral for the loans" and used the proceeds to "prop up" his Force India F1 team as well as pay for the lease of his private jet, Mark Summers, a lawyer for Indian prosecutors, said. Mallya, who is free on £650,000 ($879,000) bail, was arrested in London in April "after a consortium of 17 banks accused him of willfully defaulting on" more than 91B rupees ($1.4B) in debt accumulated by the airline that he founded in '05 and shut down seven years later. He told reporters before the hearing that "the allegations are baseless, unfounded" (BLOOMBERG, 12/4).