Lilavati Trust Files FIR Against HDFC Bank CEO Over ₹2 Cr Cash Payoff Allegation

A legal storm has erupted in Mumbai after the Lilavati Kirtilal Mehta Medical Trust (LKMMT) filed a criminal complaint against Sashidhar Jagdishan, Managing Director and CEO of HDFC Bank, alleging he accepted illegal payments tied to the misuse of charitable funds. The charges were filed via a court-directed FIR and stem from a broader internal feud within the hospital trust’s leadership.

The Allegations

The FIR, filed by trustee Prashant Mehta on June 7, outlines the following key charges:

• ₹2.05 crore allegedly paid in cash to Jagdishan, reportedly recorded in a seized handwritten diary.

• A further ₹1.5 crore said to have been routed as CSR funds to manipulate hospital staff and suppress internal dissent.
• Broader criminal accusations: breach of trust, cheating, criminal conspiracy, and misuse of public charitable assets.

The complaint claims these payments were part of a pressure campaign targeting Prashant Mehta’s father and linked to an ongoing battle between the Kishor Mehta and Vijay Mehta factions—accused of siphoning ₹1,200–1,500 crore from the Trust.

HDFC Bank’s Response

The bank issued a strong rebuttal, calling the FIR "baseless and malicious." It alleges that the FIR is a diversionary tactic by loan defaulters, particularly linked to Splendour Gems, whose dues stood at ₹65.22 crore as of May 31, 2025.

HDFC claims:

• It is armed with a 2004 DRT recovery certificate against the defaulters.
• The attempt to implicate the CEO is an orchestrated move to delay loan recovery proceedings.
• It will pursue legal action to defend its CEO’s integrity.

Regulatory and Market Impact

The FIR has drawn attention from financial observers, with investors eyeing possible reputational damage to one of India’s largest private banks.

The Trust has made formal appeals to RBI, SEBI, and the Finance Ministry demanding:

• Jagdishan’s suspension and prosecution.
• An immediate forensic audit of the transaction trail.
• A ban on Jagdishan from holding any post in SEBI-regulated entities.

What Lies Ahead

1. Police Investigation: Mumbai Police will now examine the authenticity of the seized diary and check for tampering or destruction of records.
2. Regulatory Action: The involvement of RBI and SEBI could trigger governance audits and stricter internal controls.
3. Court Proceedings: Legal strategies adopted by both parties will influence reputational outcomes and set precedents for corporate accountability.
4. Investor Sentiment: HDFC Bank’s stock and governance credibility are in the crosshairs of public and institutional scrutiny.