Star Housing Finance Limited has filed a Fraud Monitoring Report-1 with the National Housing Bank following concerns raised about a suspected phantom loan book worth Rs. 120 crore. The development comes after a snap audit report issued by the National Housing Bank flagged potential irregularities in the company's loan portfolio.

Regulatory Filing Details

The company submitted the fraud monitoring report in compliance with the Master Direction on Frauds by the Reserve Bank of India. This filing was made following instructions from the Board of Directors and represents a significant regulatory disclosure for the housing finance company.

Company's Position and Clarifications

Star Housing Finance has emphasized that the findings regarding the phantom loan book are currently suspected and have not yet been established as factual. The company is taking proactive steps to address the concerns raised by the regulatory audit.

The housing finance company has announced its intention to appoint independent auditors to conduct a comprehensive external audit of the matter. This independent review is expected to provide clarity on the suspected irregularities and help establish the facts surrounding the loan book in question.

Regulatory Compliance

The disclosure was made under Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015. This regulation requires listed companies to disclose material events and information that could impact investor decisions.

The filing follows a previous intimation made by the company on April 3, 2026, indicating that this is part of an ongoing regulatory process. The company has requested the stock exchange to take note of this information as part of its compliance obligations.

Star Housing Finance Limited's Board of Directors held a meeting on 3rd April 2026 to address critical regulatory compliance matters following receipt of a snap audit report from the National Housing Bank (NHB). The board meeting was convened specifically to discuss the audit findings and implement necessary corrective measures.

Board Decisions and Compliance Actions

The board took comprehensive action regarding the NHB snap audit report through several key decisions:

Regulatory Compliance Framework

The board demonstrated proactive compliance by acknowledging the audit observations and implementing a structured response mechanism. Management has been specifically instructed to provide immediate replies to address the snap audit findings. This approach reflects the company's commitment to maintaining regulatory standards and addressing supervisory concerns promptly.

Independent Professional Review

A significant decision involved directing external auditing of all sections highlighted in the NHB snap audit report. The board mandated that independent professional auditors examine these areas to ensure comprehensive review and compliance. This external validation approach strengthens the company's internal controls and demonstrates transparency in addressing regulatory observations.

Suspicious Transaction Reporting

The board emphasized strict adherence to anti-money laundering protocols by directing that all suspicious transactions identified in audit reports must be reported through FMR-1 submissions to relevant regulatory authorities. This measure ensures compliance with financial monitoring requirements and maintains the company's regulatory standing.

The meeting was held pursuant to Regulation 30 of the Securities and Exchange Board of India (Listing Obligations and Disclosure Requirements) Regulations, 2015, with Company Secretary and Compliance Officer Nachiketa Purohit overseeing the disclosure requirements.