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Rotomac: The Ball Pen Scam

IndianMoney.com Research Team | Updated On Wednesday, February 21,2018, 04:34 PM

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Rotomac: The Ball Pen Scam

 

 

 

Vikram Kothari the promoter of Rotomac Pens, is in the news for the wrong reasons. He is at the centre of a Rs 3,695 Crore, bank fraud. A blast from the past. You must be remembering the catch line 'Likho India Ki Nai Pehchan' and 'Likhte Likhte Love Ho Jaye'.

Bollywood superstars Salman Khan and Raveena Tandon advertised his products. Remember the Javed Akthar tagline, 'Fighter Hamesha Jeet Ta Hai'. This tagline made Rotomac a household name.

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Vikram Kothari: A man of high tastes

 

Vikram Kothari the promoter of Rotomac Global Pvt. Ltd. loves the good life. A life of Foreign Cars and Parties and Rotary Clubs.... Vikram Kothari had a black BMW in the early 90's.

This is what a family friend of Vikram Kothari has to say, The man had amazing marketing skills and was a workaholic.

 

Something about Vikram Kothari

 

Vikram Kothari is the elder son of the late Mansukhbhai Kothari, who launched Kothari Products Ltd., way back in 1973. Mansukhbhai Kothari started the iconic Pan Parag which is a combination of Betel Nuts, Cardamom, Lime, Catechu and Natural Perfumes.

Vikram Kothari is famous for the Rotomac Pens, the affordable ballpoint pen which was manufactured in 1992. Rotomac Pens were an instant hit, challenging the Linc and Luxor pens.

In 1999, Vikram Kothari got control of Rotomac Pens. This was the time when much cheaper roller pens came into the market costing around Rs 5. Rotomac took a severe beating.

Vikram Kothari diversified his business and the Company was named Rotomac Global Pvt. Ltd. His Companies were into the real estate and the Mall business. Vikram Kothari also started the mouth-freshener business under Kothari Foods and Fragrances.

Vikram Kothari is the Chairman of Rotomac Exports Pvt Ltd, which is into the export business and exports rice, wheat, maize, gold, superior kerosene and so on. He also heads Crown Alba Writing Instruments, Mohan Steels Ltd., RFL Infrastructure Pvt. Ltd., and Rave Entertainment Pvt. Ltd.

 

SEE ALSO: How Clever Fraudsters Fooled PNB Of Rs 11,000 Crores?

 

Vikram Kothari the bank defaulter

 

Rotomac Global Private Limited has cheated a consortium of banks of around Rs 3,695 Crores. Rotomac owes the Bank of India, Bank of Baroda, United Bank of India, Bank of Maharashtra, Allahabad Bank, Oriental Bank of Commerce and Indian Overseas Bank, crores of rupees.

 

SEE ALSO: Could Blockchain Have Stopped The PNB Fraud?

 

What is the Rotomac Scam?

 

CBI has stated that the promoters of Rotomac Global Pvt. Ltd. had availed loans to procure goods for exports, but no export order was ever executed. The money got from loans, was diverted to an offshore account. This money was then diverted to a Kanpur-based Company without executing any export order.

Vikram Kothari has been accused of round-tripping. Round-tripping is a practice in which a Company sells an unused asset to another Company and then agrees to buy back the same asset, at about the same price.

 

What's Vikram Kothari being accused of?

 

1. The credit (loan amount) sanctioned for an export order from Singapore for the supply of Wheat, was diverted to a Singapore-based firm Bargadia Brothers Pvt Ltd. This money was then remitted to Rotomac.

2. Banks sanctioned loans to Rotomac for executing export orders, but they were used for different purposes.

3. The Company profited from the interest rate differential between local and foreign currencies.

4. The Company submitted fake and false/forged documents. Many of Kothari's buyers and suppliers abroad operated from virtual offices.

5. Front Companies were set up, to facilitate fraudulent business transactions. Be Wise, Get Rich.

 

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