CBI, ED and SEBI pursue DHFL's Wadhawans in Rs 34,615 crore case

What the Record Shows

Three arms of the Indian state have acted against the former promoters of Dewan Housing Finance Corporation Ltd (DHFL) over what the Central Bureau of Investigation describes as one of the largest bank cases on its books. The CBI registered an FIR on 20 June 2022, referenced RC 2242022A0001, against DHFL, its former chairman and managing director Kapil Wadhawan, former director Dheeraj Wadhawan and others, and later filed a chargesheet. The Enforcement Directorate filed a money-laundering chargesheet in May 2025, and SEBI passed a market-restraint order in August 2025.

The core allegations are recorded in a public court document. In its order dated 30 May 2023 in CRL.M.C. 6544/2022, the Delhi High Court noted that the CBI alleges the diversion or misappropriation of about Rs 34,926 crore out of aggregate loans of roughly Rs 42,000 crore extended by a 17-bank consortium led by Union Bank of India. The FIR headline figure commonly cited is Rs 34,615 crore.

This is an allegation-stage matter. There has been no conviction. The Wadhawans were granted default bail, which the Delhi High Court declined to cancel, and the accusations set out below are those made by investigating agencies and a regulator, which remain to be tested at trial or on appeal.

How It Worked

Per the CBI FIR as recorded by the Delhi High Court, the agency alleges that DHFL's books were falsified through a fictitious "Bandra branch-001" and around 87 controlled entities, the so-called Bandra Books, and that a FOXPRO-based system was manipulated "to generate fictitious retail borrowers". The ED's chargesheet goes further, alleging that roughly 2.60 lakh fake or non-existent home-loan borrowers were booked to inflate the retail loan portfolio, with consortium funds then routed onward to a web of related entities.

A forensic audit by KPMG, cited across the investigations, reported that about Rs 24,595 crore was disbursed to 65 interrelated entities between April 2015 and December 2018. The Delhi High Court's order records the CBI's assertion that diverted funds were applied to assets including jewellery worth about Rs 174 crore and paintings worth about Rs 63 crore, alongside foreign transfers and share purchases. SEBI, in its August 2025 order, is reported to have traced about Rs 5,662 crore of loans to 39 Bandra Book entities, while the ED alleges that approximately Rs 11,569 crore was actually diverted.

The procedural history spans several agencies and regulators. The CBI FIR of June 2022 was followed by a chargesheet; the ED filed its money-laundering chargesheet in May 2025, naming the Wadhawans, 15 others and a legal consultant; and SEBI on 12 and 13 August 2025 restrained Kapil and Dheeraj Wadhawan from the securities market for five years, with penalties reported at about Rs 120 crore across six persons and shorter restraints on former promoters Rakesh and Sarang Wadhawan and on former chief executive Harshil Mehta and former chief financial officer Santosh Sharma. Every figure and characterisation here is an allegation by an investigating agency or a finding by the regulator, not a criminal conviction.

Who Lost Money

The money at stake was overwhelmingly public and institutional. The 17 banks in the consortium, led by Union Bank of India, had lent an aggregate the CBI puts at around Rs 42,000 crore, and their exposure is public money channelled through the banking system. Beyond the banks, DHFL had raised funds directly from the public through fixed deposits and non-convertible debentures, and many of those holders were retail savers who had treated an established housing-finance name as safe.

Recovery for these creditors came chiefly through the insolvency process rather than the criminal cases. After the Reserve Bank of India superseded DHFL's board and referred it for resolution, the company was resolved under the Insolvency and Bankruptcy Code through an acquisition by the Piramal group, which returned a fraction of admitted claims to lenders and to fixed-deposit and bond holders.

The criminal-law recovery runs on a separate track and is far from complete. Attachments and asset seizures by the ED are investigation-stage steps that require confirmation before any distribution, and the sums realised so far are a small part of the amounts alleged to have been diverted. Retail savers weighing the yield on a corporate deposit or debenture against its risk can model the outcomes with Oquilia's lump-sum returns calculator.

Where It Stands Now

As of now, the matter remains pre-conviction on every criminal track. The Wadhawans were granted default bail by the Special Judge in December 2022, and the Delhi High Court, in its order of 30 May 2023, dismissed the CBI's plea to cancel that bail, holding that "merely filing chargesheet cannot defeat statutory bail right". The ED's May 2025 chargesheet and the CBI's case are before the respective courts, where charges are yet to be brought to trial.

The SEBI order of August 2025 is a civil regulatory finding under the SEBI Act, distinct from the criminal proceedings, and is appealable to the Securities Appellate Tribunal. Separately, a Mumbai special court discharged DHFL, the company, from the Yes Bank PMLA proceedings on 2 February 2026, on the ground of statutory immunity following its IBC resolution. That immunity attaches to the resolved company; on the record it does not extend to the individuals accused.

An FIR and a chargesheet contain allegations, not findings of guilt; the accused are presumed innocent until proven guilty, and due process continues. No court has ruled on whether the Bandra Books were fictitious, whether the fake-borrower accounts existed as alleged, or whether the diversion occurred as the agencies claim.

What It Means

The DHFL matter shows how India now pursues a large financial-sector failure on parallel tracks that do different jobs. The IBC resolution is about returning value to creditors and did the bulk of the actual recovery; the CBI and ED cases are about criminal accountability and asset attachment; and the SEBI order polices conduct in the securities market. A creditor's recovery and an accused person's guilt are decided in entirely different forums, on different standards, and at different speeds.

For an individual saver, the practical lesson is that a fixed deposit or debenture issued by a non-bank finance company is a credit exposure to that company, not a guaranteed instrument, and ranks behind or alongside other creditors if the issuer fails. The rating of an instrument and the identity of its issuer can be checked before investing, and RBI and SEBI publish the registration status of regulated entities. The wider pattern in NBFC and bank cases is consistent: the headline figure alleged by investigators is almost always far larger than what is eventually recovered. You can follow related matters through Oquilia's enforcement archive, including the Winsome Diamonds bank case and a recent SEBI market-restraint order.

FAQ

Does this mean the people named are guilty?

No. An FIR, a CBI chargesheet and an ED chargesheet contain allegations, not findings of guilt. The Wadhawans and the other accused are presumed innocent until proven guilty, and due process continues before the trial court. There has been no conviction in this matter.

What did SEBI order against the Wadhawans?

Per its order of August 2025, SEBI restrained Kapil and Dheeraj Wadhawan from the securities market for five years and imposed monetary penalties, with further restraints on four other former DHFL officials. A SEBI order is a civil regulatory finding under the SEBI Act and is appealable to the Securities Appellate Tribunal.

Was DHFL the company discharged in any case?

Yes. A Mumbai special court discharged DHFL, the company, from the Yes Bank PMLA proceedings on 2 February 2026, on the ground of statutory immunity following its resolution under the Insolvency and Bankruptcy Code. That immunity attaches to the resolved company and does not extend to the individuals accused.

Did lenders and investors recover their money?

Only partly, and mainly through the insolvency process rather than the criminal cases. DHFL was resolved under the IBC through an acquisition by Piramal, which returned a fraction of admitted claims to the 17-bank consortium and to fixed-deposit and bond holders. Criminal recovery through attachments is separate and ongoing.

Where can I read the official record?

The Delhi High Court's order dated 30 May 2023 in CRL.M.C. 6544/2022, which records the CBI's allegations and the FIR reference RC 2242022A0001 dated 20 June 2022, is available on Indian Kanoon and is linked below.

This report is based on the order of the Delhi High Court dated 30 May 2023 in CRL.M.C. 6544/2022 and the public enforcement and regulatory record reviewed on 1 August 2026.