Lack of wealth mgt guidelines cause for Citibank fraud: Parekh

Gandhinagar, Jan 13 (PTI) HDFC Ltd Chairman Deepak Parekhtoday blamed the Rs 400-crore Citibank fraud to absence ofspecific guidelines for wealth management and expectedregulators to come out with norms in this regard.

"I think wealth management has spread so much that in thelast decade huge amount of wealth creation has happened inIndia... As a result, wealth managers and companies managingwealth for other people have mushroomed and there are noguidelines for that," he said.

Speaking on the sidelines of the 5th global summit ofVibrant Gujarat here, Parekh said, "I think the governmentwill come out with guidelines for the same".

He said the country should have good system and audits inplace to prevent recurrence of such fraud.

At present, there are no specific regulations for wealthmanagement for high net worth individuals (HNIs) and they comeunder norms for portfolio management by market regulator SEBI.

In December, Shivraj Puri, a relationship officer at theGurgaon branch of Citibank was taken into custody forallegedly duping about 40 HNIs investors and corporateentities to the tune of Rs 400 crore.

A senior official of Hero Corporate Services SanjayGupta, has also been named as a co-accused in the fraud forallegedly getting Rs 20 crore commission from Puri in lieu ofarranging investments.

Vikram Pandit, the Indian-born global CEO of Citibank,and its Chairman William R Rhodes, were also named in aseparate FIR by investor Sanjeev Aggrawal, who lost about Rs33 crore.

Police are still investigating the case.