BlackRock Arm Joins $500 Million Fraud Lawsuit Against Indian-Origin Telecom Executive Bankim

Global asset manager BlackRock, through its private-credit arm HPS Investment Partners, has joined a coalition of major lenders in a federal lawsuit seeking to recover more than $500 million allegedly defrauded by Indian-origin telecommunications executive Bankim Brahmbhatt. Filed in August 2025, the complaint accuses Brahmbhatt—owner of Broadband Telecom, Bridgevoice, and affiliated entities including Carriox Capital—of constructing an elaborate financial facade by generating fictitious invoices and accounts receivable to secure substantial loans. The scheme, described in court documents as "breathtaking," enabled the transfer of funds to offshore accounts in India and Mauritius while presenting a veneer of robust cash flow and operational legitimacy.

The lending relationship commenced in September 2020, with HPS initially advancing $385 million in early 2021, subsequently increasing exposure to approximately $430 million by August 2024. French banking giant BNP Paribas is reported to have financed nearly half of these commitments through structured facilities tied to HPS funds. To safeguard the transactions, HPS retained Deloitte for randomized customer verifications during onboarding and later engaged CBIZ for annual audits. Despite these measures, the fraudulent collateral remained undetected for nearly five years, raising serious questions about due diligence protocols in the rapidly expanding private credit sector, now valued at $1.7 trillion globally.

The unraveling began in July 2025 when an HPS analyst flagged irregularities in email domains used to confirm receivables, many of which mimicked legitimate telecom operators but originated from fabricated sources. A comprehensive forensic review by law firm Quinn Emanuel and CBIZ revealed that every client email submitted over the prior two years was counterfeit. Further scrutiny uncovered forged contracts dating back to 2018, including a purported agreement with Belgian carrier BICS, whose security team formally declared the correspondence a "confirmed fraud attempt" in written correspondence with investigators.

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Confronted with mounting evidence, Brahmbhatt initially dismissed the concerns before ceasing all communication. A subsequent site visit to his Garden City, New York headquarters found the offices locked and deserted, with adjacent tenants confirming no activity for weeks. At his nearby residence, luxury vehicles—two BMWs, a Porsche, a Tesla, and an Audi—remained parked in the driveway alongside unclaimed packages, suggesting abrupt departure. On August 12, Brahmbhatt filed for personal bankruptcy, while his corporate entities sought Chapter 11 protection, disclosing liabilities exceeding $500 million against minimal verifiable assets.

The scandal has emerged at a precarious moment for BlackRock, which completed its acquisition of HPS earlier in 2025 as part of a strategic push into private markets. Legal efforts now focus on tracing and freezing offshore transfers, though jurisdictional challenges in India and Mauritius complicate recovery. The case underscores systemic vulnerabilities in collateral validation and serves as a cautionary tale for institutional investors navigating high-yield, low-transparency lending environments.

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