Former Head of Diageo Subsidiary United Spirits Bucks Fraud Charges and Demands Over $800M from Government

Ex-Chairman of United Spirits, a Diageo subsidiary, is demanding over $800 million from the Indian government as he pushes back at asset seizures from financial authorities. (Photo: AP Photo/Matt Dunham)

The Drinks Business reported on Dec. 20 that the Ex-Chairman of United Spirits and United Breweries, Vijay Mallya, is pushing back against asset seizures due to convictions of fraud and money laundering from the Indian government.

The former head of Diageo’s United Spirits claims the seizure of his assets amounted to 14,131.60 crore ($1.7 billion), yet he claims the court reported he owed the government 6,203 crore, a significantly lower sum.

To make up the difference, the outlet reports that Mallya is demanding that Indian financial authorities pay him over double his court-ordered debt, or $877,226,0000 million.

The outlet reported that Mallya is demanding banks offer legal reasoning for seizing over two times the purported debt amount after the closure of his company, Kingfisher Airlines. If the government cannot justify its asset seizures, he claims he is owed that compensation.

Mallya additionally owes Diageo and United Spirits over $300 million after he sold United Breweries to Diageo, according to The Drinks Business. The outlet reported that Diageo won a judgment against the tycoon, but Mallya has apparently not paid back his debts to the spirits company.

Reuters reported in July that India’s financial authorities banned Mallya from trading assets and engaging with publicly traded companies until 2027. The outlet shared that Mallya faced extradition charges from Indian authorities after he relocated to Britain.

At the time, he owned 8.1% of United Breweries and 0.01% of Smirnoff vodka. The wealthy tycoon proclaimed his innocence and denied any form of wrongdoing.

In July, Diageo India’s CEO was ordered by New Delhi’s anti-corruption police to appear in court involving an investigation into the beverage behemoth’s billing practices with the government and liquor stores from 2017 to 2020.

The company is the majority stakeholder of United Spirits Limited, and the company urged its CEO, Hina Nagarajan, to provide documentation of sales records to the government.

A spokesperson for Diageo claimed coverage of the incident was “grossly misleading” and that such practices were part of a “routine process.”