MUMBAI, May 31 -- Dewan Housing Finance Corporation Limited (DHFL) promoters Kapil and Dheeraj Wadhawan diverted around Rs.11,548 crore from the company to 87 fictitious entities-known as Bandra Book firms-for business purposes and personal use, according to the Enforcement Directorate's (ED's) charge sheet in the Rs.34,614-crore bank loan fraud case linked to the company. The brothers used the diverted funds to purchase 25 paintings and a sculpture worth over Rs.63 crore, expensive jewellery, and a 20% stake in Pune-based Varva Aviation, among other items, according to the charge sheet, a copy of which was seen by HT. The investigation has revealed that DHFL developed a software that automatically split hundreds of crores diverted to its real estate arm through 87 shell firms into thousands of retail loans to mask the diverted amounts from banking regulators. The loans were sanctioned in the name of RKW Group, a company named after the initials of Kapil and Dheeraj Wadhawan's father, Rajesh Kumar Wadhawan, according to the charge sheet. While Dheeraj Wadhawan raised the fund requests, his brother Kapil approved the loans through emails without following the proper procedure. A record of these transactions was maintained on an isolated computer that wasn't connected to the company's LAN network, the charge sheet said. The charge sheet named 17 people and entities, including the Wadhawan brothers and the RKW Group. When the Wadhawans needed funds for their real estate projects and several other personal expenses, they would send one-page letters or cryptic emails to a particular officer at DHFL, the charge sheet said. Kapil Wadhawan then approved the "loan proposals" without following due procedure by simply replying, "Okay, Approved." The approved proposals were then forwarded to the concerned bank branch for money disbursal. The shell companies or Bandra Book firms were directly under the control of Kapil Wadhawan, said the charge sheet. All the accounts of the Bandra Book firms were maintained on a single computer that was isolated and not connected with the housing finance company's LAN network. The computer was allegedly handled by very few close associates of Kapil Wadhawan. The loans were then allegedly sanctioned as retail or home loans by bypassing all retail credit policy norms and without consulting the company's retail, property, legal or sales teams. Despite officially closing in 2004, the Bandra branch of DHFL was kept alive only because of the Wadhawan brothers' surreptitious instructions, the charge sheet said. As soon as the funds were illegally diverted to the group firms, they were then split into smaller amounts and recorded as retail or home loans for 260,000 fictitious loan accounts in the company's database management software, the charge sheet said. The software, called FOXPRO, would then automatically generate fake data of multiple small home loans-mostly using details of DHFL's earlier customers-in order to inflate the company's retail loan books for further funding. The ED's money-laundering probe against the company is based on a case registered by the Central Bureau of Investigation (CBI) on February 11, 2022. The CBI began its investigation after a consortium of 17 banks led by the Union Bank of India alleged that the DHFL promoters conspired with their associates and got the banks to sanction loans amounting to Rs.42,871 crore between January 2010 and December 2019. The subsequent loan defaults allegedly resulted in losses of Rs.34,615 crore to the consortium....