HDFC Bank denies charges by US law firm

INDIA’S largest private sector lender HDFC Bank on Monday denied the allegations of misleading claims levelled by a US-based law firm to seek damages in a class action suit.

The bank vowed to defend itself “vigorously” in the lawsuit and added that the response to the lawsuit will be ready by early next year.

Rosen Legal last week filed the class action suit seeking damages for the losses incurred by investors because of alleged ‘materially false and misleading’ representations by HDFC Bank. It had specifically named the bank’s chief executive and managing director of over 25 years, Aditya Puri, his designated successor

Sashidhar Jagdishan and company secretary Santosh Haldankar as defendants.

The bank said the lawsuit has been filed against three of its employees by a ‘single small security holder who seeks to represent a class’ of its security holders, and is based on allegations, that the security holder claims, caused a temporary decline in the Bank’s ADR (American Depository Receipt) stock price in July.

‘The Bank denies the allegations and intends to defend itself vigorously in the lawsuit,’ it said in an exchange filing.

The complaint did not mention the exact quantum of the damages sought though it maintained that may be thousands of investors would have suffered.

As per the suit, bank officials ‘engaged in a plan, scheme, conspiracy and course of conduct, pursuant to which they knowingly or recklessly engaged in acts, transactions, practices and courses of business which operated as a fraud and deceit”, resulting in the losses to investors.

The allegations pertain to the vehicle finance vertical, where the bank has later acknowledged to have found some improprieties which resulted in some executives being acted against.