
Dubai, June 27: HDFC Bank, India’s largest private lender, is under scrutiny in the UAE over allegations it sold high-risk Credit Suisse AT1 bonds to retail investors in violation of regulatory norms.
The bonds — complex instruments meant only for experienced or high-net-worth clients — were wiped out in March 2023 during Credit Suisse’s emergency merger with UBS. Several investors claim HDFC Bank relationship managers misrepresented these as safe, forged financial documents to meet eligibility criteria, and failed to disclose crucial risks.
Dubai resident Varun Mahajan says he lost $300,000 in savings and alleges the bank inflated his net worth to bypass DFSA rules. Another investor, NS from the Philippines, claimed he was sold AT1 bonds using a leverage loan he never applied for. Others, including Indian national Pankaj Sinha and South Africa-based AT, described similar misrepresentation, unauthorized document changes, and manipulation of KYC data.
Legal complaints have been filed in India, the UAE, Bahrain, and DIFC. Investors accuse the bank of misleading them and exposing them to losses running into millions of dollars.
In response, HDFC Bank denied any wrongdoing, stating it follows strict processes and takes action against malpractice. The DFSA has declined to comment due to legal confidentiality.
Internal sources say several HDFC executives have recently resigned, and the Dubai offshore head has been replaced, raising questions about accountability.
Experts say the case exposes regulatory gaps across jurisdictions and may prompt closer scrutiny of how banks operate across borders.
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