SHAEL OSWAL, singer and scion of Oswal Group, used his offshore company in the British Virgin Islands to market coal sold by an Indonesian mining company that he partly owned, according to records in the Pandora Papers investigated by The Indian Express.
During 2010-2011, records show, almost the entire sale of coal mined by PT Garda Tujuh Buana TBK (GTBO) took place through Briskon Holdings Ltd (BVI) which also received over $21 million from the Indonesian company for supplying machinery.
Oswal did not respond to queries from The Indian Express on whether he had disclosed his ownership of Briskon Holdings to GTBO and its shareholders, and regulators.
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In 2009, Oswal moved to Singapore, set up a company structure to hold a 30 per cent stake in GTBO through Alata Overseas PTE Ltd (Singapore), and became the beneficial owner of Briskon Holdings (BVI).
However, records of corporate services provider Asiaciti Trust show that Oswal subsequently declined to comply with due diligence requirements for Briskon Holdings. This “explicit refusal” prompted Asiaciti Trust to brand Briskon Holdings as “not a suitable client”, which “should be transferred” to an alternative provider.
An internal file note of Asiaciti outlines the situation in a telephone conversation with Oswal’s representative, who is identified only as “NS”.
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“NS further repeatedly stated that he and SO (Shael Oswal) would not provide documents or further details, as these were ‘not our business’ and that other service providers would not request them… (we) did not agree with this assertion, however, it was clear from NS’s aggressive behaviour during the call that argument would be futile,” the note said.
In two communications to Oswal in March and July 2012, Asiaciti flagged “an increase in activity” of Briskon Holdings which was used for “purchase and sale of mining assets” until Oswal became the beneficial owner.
On the list of Asiaciti’s concerns were:
* No reason for change of beneficial ownership to Oswal.
* Uncertainly over number of operational bank accounts, including 10 in Asiaciti’s knowledge — Credit Suisse, EFG, Societe Generale, Barclays Bank, Banque Pictet & Cie, DBS Bank, Overseas Chinese Banking Corporation, UBS AG, Bank of Singapore, ABN Amro Singapore.
* Source of assets significantly higher — in excess of $400 million with banks, and over $400 million more in credit facilities — than the previous understanding of the company’s purpose.
* Nature of large-value transfers from Hong Kong and Middle East companies.
While he did not comply with the due diligence requests, Oswal made certain disclosures for shifting Briskon Holdings to another service provider. These include:
* Two Singapore citizens, the original beneficial owners, transferred the ownership of Briskon Holdings, set up in 2008, in payment of a debt they owed to Oswal.
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* All funds in Briskon Holdings belonged to Shael Oswal who inherited $800 million and a listed coal mining business in Indonesia from his father Abhey Oswal.
* Receipts from Hong Kong and Middle East companies are connected to the family business in Indonesia’s coal industry.
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By September 2012, Oswal shifted Briskon Holdings to another corporate service provider in Singapore. In 2014, the offshore company was struck off the BVI Registry for non-payment of fees.
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