---
title: "After Jefferies, did BlackRock also suffer? Reported losses due to a \"shocking\" fraud case involving lenders"
type: "News"
locale: "zh-HK"
url: "https://longbridge.com/zh-HK/news/263594640.md"
description: "Following the financing client First Brands of Jefferies experiencing a crisis, BlackRock has also exposed the \"black box\" of private credit. BlackRock's loan providers, such as HPS, which it acquired this year, have sued the owners of telecommunications service companies Broadband Telecom and Bridgevoice, Brahmbhatt, claiming that the bankrupt company owes over $500 million. Investigations have revealed that every email used to verify invoices provided by the company over the past two years was forged, and its fraudulent customer contracts date back to 2018"
datetime: "2025-10-30T20:01:13.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/263594640.md)
  - [en](https://longbridge.com/en/news/263594640.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/263594640.md)
---

> 支持的語言: [简体中文](https://longbridge.com/zh-CN/news/263594640.md) | [English](https://longbridge.com/en/news/263594640.md)


# After Jefferies, did BlackRock also suffer? Reported losses due to a "shocking" fraud case involving lenders

After Jefferies triggered market turbulence due to the collapse of First Brands, the world's largest asset management company BlackRock has also exposed the "black box" of private credit, allegedly involved in a private credit fraud case.

On Thursday, October 30, Eastern Time, media reports revealed that BlackRock's private credit division HPS Investment Partners and other lenders are attempting to recover hundreds of millions of dollars, accusing a business owner of falsifying accounts receivable as loan collateral in a "stunning" fraud case.

According to the media, the lenders filed a lawsuit in August against Bankim Brahmbhatt, the owner of telecommunications service companies Broadband Telecom and Bridgevoice, claiming that his company owes more than $500 million. BNP Paribas participated in BlackRock HPS's financing arrangement, providing nearly half of the funds for the involved loans, approximately $220 million. Brahmbhatt's lawyer stated that his client denies the fraud allegations.

This case once again brings the opaque corner of asset-backed financing in private credit into the spotlight. In recent months, the sudden collapses of First Brands and Tricolor in the automotive industry have raised questions about risk control in this sector. Wall Street is concerned that these events may be early warning signs of deeper issues in the U.S. credit market.

## Details of the "stunning" fraud case: forged emails and false invoices

Earlier this year, BlackRock acquired the credit giant HPS, expanding its private asset investment footprint. HPS began providing loans to at least one subsidiary financing entity of Brahmbhatt's telecommunications company, Carriox, in September 2020, with the investment scale increasing from approximately $385 million initially to about $430 million by August 2024. Insiders stated that BNP Paribas provided nearly half of the funding for this loan.

When HPS started lending, it hired Deloitte for random customer checks to verify assets, and later designated the accounting firm CBIZ for annual asset inspections. However, in July of this year, an HPS employee noticed that certain email addresses claiming to be from Carriox customers were suspicious. Insiders said these emails came from fake domains mimicking real telecommunications companies, and a review of historical emails showed similar issues.

When HPS officials inquired about these anomalies with Brahmbhatt, he assured them that there were no problems. He then stopped answering calls. An individual working with HPS visited Brahmbhatt's office in Garden City, New York, in July and found it closed. Media discovered last Wednesday that Brahmbhatt's office suite was locked and appeared vacant, and there was no response at his residence.

## Client denies business dealings; lenders accuse systemic fraud

After HPS employees discovered the anomalies, CBIZ and the law firm Quinn Emanuel began investigating the customer emails shared by the borrower at the lenders' request. Court documents show that many email addresses did not match the clients' public domain names. Belgian telecommunications company BICS explicitly denied any connection to the emails shared by Brahmbhatt's company with the lenders According to the attachments of the August lawsuit documents, a security personnel from BICS wrote in an email to Quinn Emanuel lawyers on July 18: "This is indeed a confirmed attempt at fraud."

The lenders accused in the lawsuit that the investigation determined that every customer email provided for invoice verification by Brahmbhatt's company over the past two years was forged. They also discovered false customer contracts traceable back to 2018. "Brahmbhatt created a meticulously designed balance sheet, but these assets only existed on paper," the lenders' lawyer wrote in the documents. The lawsuit also accused Brahmbhatt of transferring assets that should have been used as collateral to offshore accounts in India and Mauritius.

Brahmbhatt's telecommunications company filed for bankruptcy in August, and its financing firms Carriox Capital II and BB Capital SPV also joined the bankruptcy proceedings last week. BNP Paribas stated in its quarterly report submitted to regulators on Tuesday that it has increased its loan loss provisions by €190 million (approximately $220 million) for a "specific credit situation," but a spokesperson declined to disclose whether this was related to Carriox.

## Risks of Asset-Backed Financing Highlighted, Regulatory Attention Increased

The asset-backed financing involved in this case is a debt transaction secured by specific business revenues, equipment, or customer receivables. This market has significantly grown with the overall expansion of the private credit industry, but recent issues have emerged one after another.

Automotive parts supplier First Brands filed for bankruptcy after losing market confidence due to off-balance-sheet debt, causing Jefferies' stock price to plummet about 18% from the end of September to mid-October, with a market value evaporating by approximately $2.5 billion. The automotive dealership chain Tricolor was accused by banking partners of pledging fictitious auto loans before filing for bankruptcy.

On Thursday, media learned that HPS has informed some clients that it believes Brahmbhatt is currently in India. This investment represents a small portion of the $179 billion in assets managed by HPS, and sources close to BlackRock indicated that writing off this loan would not have a significant impact on the returns of the HPS fund holding it this year, stating that HPS had been collecting loan repayments prior to this year. On the same day that Brahmbhatt's telecommunications company filed for bankruptcy—August 12—he also filed for personal bankruptcy, having previously provided a personal guarantee at the lenders' request.

Thursday's revelations added further gloom to the already tense private credit market due to the First Brands incident, highlighting that this $20 trillion industry still has systemic weaknesses in due diligence and risk control

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