He was not only a successful businessman but also the son-in-law of SM Krishna, the former Congress CM of Karnataka (his company's headquarter is in the capital city of the state).
Not only the nature of his death was mysterious but its timing puts a big question mark over his suspected suicide as he committed suicide just after a long drawn out battle to re-make the state government was won by the current ruling party at the center by toppling the wobbly coalition government at the state.
Successful businessmen who happen to be a family member of big politicians, just don't commit suicide unless they have no means to escape or murder is made to look like suicide. I wonder if the ISRO scientists that "committed suicides" were bumped off too?
I was very sure that this case was not as simple as a disturbed businessman committing suicide as he was "harassed by income tax officials" or he killed himself due to "the unimaginable challenges that businessmen in India have to face", despite repeated op-eds in the newspapers. (Business Standard) (ThePrint)
Well, we might not be able to ever find out why he killed himself if that's what actually happened or why was he killed (if that's true) but one thing we know for sure that his mega-successful coffee chain - Cafe Coffee Day - was not as successful as we might think it is.
As I had pointed out the last time that there were serious issues with the finances of the company and how businesses such as these are a good medium to do money laundering for political parties.
The company was already under the lens of the authorities and facing punitive action for its financial irregularities – over Rs 650 crore of undisclosed income was recovered from the founder’s home and offices in an income tax raid in 2017 while SEBI had imposed a fine of Rs 14.5 crore on two of the founder’s companies based out of Singapore and Hong Kong.
If this wasn’t enough, the auditor (EY) tasked with investigating the account books after the 'suicide' relieved itself citing ‘certain conflict of interest’.
The investigation ordered by the company’s board which is led by an ex-CBI top officer has made startling revelations that have proven the questions raised in the previous blog.
MACEL was Siddhartha’s private company that he used for making investments or taking loans. It once traded on the Bangalore and Madras stock exchanges and was acquired by him in 1996. There is still a small block of public shareholders whose whereabouts are unknown. The company counts thousands of acres of coffee plantations along with investments worth thousands of crore in Mindtree, an IT services company, and in the pharma sector as its assets.
Most importantly, it has borrowings of Rs 4,000 crore that it owes to CDEL, CCD’s holding company. This is the same amount that is missing from the books of the listed Coffee Day Enterprises. Moreover, the cash reserves of nearly Rs 2,500 crore reported by CDEL in March 2019 most probably existed only as book entries due to the financial acrobats of the founder.
The management of the company was obviously unaware of all these things and even if they did know about it, it wouldn't have mattered as the founder handled all the financials of the company himself.
A prominent anti-corruption crusader named an active top ex-Congress minister in Karnataka and a very close aid of the top leadership of Congress party as the politician that gave VG Siddhartha the money to launder from the various scams and illegal money that comes with power.
Politicians are corrupt and need their cronies to park their ill-earned money that will be needed during election time as well as for their leisure. These businessmen are smart and stay under the radar but some who desire fame and are ambitious, step out into the public light. There is a lot of risk involved in that but that's the risk for glory. There is also some comfort in the fact that auditors and regulators, as they say in politics, can be ‘managed’.
Money is made and laundered that keeps everybody happy.
The problem starts when the government in power changes or in case of an internal scuffle that makes these businessmen a scapegoat. Usually, politicians don’t go after each other for the fear of a similar treatment to them when the tides turn and it always does!
We may never know the true extent of money that politicians make but trust me it’s a lot. Who knows how many businesses/brands that we love, are legit or just a vehicle to launder money that routinely cooks their books.
Incidents like these give us a unique opportunity to get a sneak peek into what happens behind the scenes and I hope we get many more opportunities in the future that will enable us to build a full picture of the businessman-politician 'friendship'.
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