Siva had bought Sterling Computers from Robert Amritraj.
By Raif Karerat
A billionaire from India appears to have used bankruptcy for fun and profit after taking advantage of the relaxed laws of the tiny island nation of Seychelles to keep his assets away from his creditors.
Chinnakannan Sivasankaran, or Siva as his friends call him, filed for bankruptcy in August 2014 after his $3 billion empire fell victim to a civil case brought against him by a former partner, specifically a subsidiary of the Bahrain Telecommunications Company, or Batelco.
The case ruled that Siva and his Bermuda-registered company Siva Limited should pay Batelco $212 million by June 26, 2014.
However, Siva had a cunning strategy in place, one that was uncovered by a Daily Beast investigation:
However, even before the trial began, the oligarch used his Seychellois citizenship to arrange a swift legal split from his wife, to whom he then transferred at least $95 million in assets—39 plots of land, one island and numerous corporate holdings registered in Seychelles and the British Virgin Islands, including those that owned even more real estate—as part of the divorce settlement. (That transfer, in fact, took place on May 14, 2014, a day before Siva testified in court on the Batelco case.)
About a year after Siva lost his case in Britain, the island nation “reformed” its bankruptcy statute, first introduced by Seychelles Finance Minister Jean Paul Adam, thereby shortening the time span of official bankruptcy from three years to one and also making it more difficult for creditors to collect from the new owners of transferred assets.
That change occurred mere weeks before Siva became the first person in the history of Seychelles to file for bankruptcy. To date, he is also the only person to have done so before or after the law changed, and he hasn’t paid Batelco a single cent.
Meanwhile, the true nature of the financial relationship between him and his former wife remains a mystery.
Seychelles has been called the “world’s first socialist tax haven,” with a post-colonial history tethered closely to the Italian mafia and South African apartheid, according to reports. As a result, according to the Independent Consortium of Investigative Journalists (ICIJ), Seychelles is “an offshore magnet for money launderers and tax dodgers.”
“We’re seeing the abuse of companies that are either registered in Seychelles, or use nominee directors from there, to hide assets or conduct dubious activity,” Tom Mayne, a specialist in offshore jurisdictions formerly affiliated with the transparency watchdog Global Witness, told the Daily Beast.
Siva was born in 1956 in Chennai, India. He first made a splash when he bought Sterling Computers from Robert Amritraj, father of Indian tennis star Vijay Amitraj, in the mid-1980s and transforming it into one of India top-three tech outfits.
He acquired telecom licenses for Delhi, Haryana, Rajasthan, Uttar Pradesh, and Tamil Nadu in the early 1990s and in 1997 launched Aircel based out of Chennai.
Furthermore, according to NGO Grain, an international nonprofit that supports small farmers, his Siva Group gobbled up about “a million hectares of land in the Americas, Africa and Asia, primarily for oil palm plantations,” making him “one of the world’s largest farmland holders.”