Mallya funded Formula-1 team with Kingfisher fraud, lawyer says

Vijay Mallya dishonestly used bank loans to fund his Formula One racing team and a private jet, a lawyer for Indian prosecutors said while urging a London court to extradite the Kingfisher Airlines Ltd. founder to face fraud and money-laundering charges. India wants the booze and motor-racing tycoon for a trial for allegedly defaulting on a series of loans from the state-owned IDBI Bank Ltd. for his failing airline that were obtained under false pretenses. The 61-year-old deliberately provided worthless collateral for the loans and used the proceeds to prop up his Force India motor-racing team as well as pay for the lease of his private jet, Mark Summers, a lawyer for Indian prosecutors, said Monday in court papers at the start of a two-week extradition hearing. “The court is invited to disregard the defendant’s grandiose narrative,” Summers said. “Pruned of rhetoric and hyperbole, there is, despite the obviously high-profile nature of this case in India, nothing strange or remarkable about the government’s intention to prosecute.” Mallya, who is free on GBP650,000 bail, was arrested in London in April after a consortium of 17 banks accused him of willfully defaulting on more than 91b rupees in debt accumulated by the airline that he founded in 2005 and shut down seven years later. The prosecution argues that he overstated the value of securities including Kingfisher’s brand value, the rights to aircraft and the company’s revenue. The executive, wearing a navy pin-striped suit with his trademark long, gray hair, told reporters during an unexpected court evacuation before the hearing Monday that “the allegations are baseless, unfounded.”<br/>