CBI registers case in Rs. 1,438-cr. bank fraud

July 12, 2022 12:00 am | Updated 05:40 am IST - Mumbai

SBI complains against private firm

The SBI has alleged fund diversion by the private company and its directors.

The SBI has alleged fund diversion by the private company and its directors.

The Central Bureau of Investigation on Monday registered a case based on a complaint from the State Bank of India that a private company and its directors caused a loss of Rs. 1,438.45 crore to the bank and four other consortium member banks.

The agency said it conducted searches on three premises of the accused in Mumbai and Pune which led to recovery of incriminating documents/articles.

The CBI added, “It was alleged that the private/borrower company (engaged in trading of ferrous and non-ferrous metal) and its promoter directors along with unknown entities had caused loss to SBI and consortium member banks (the Central Bank of India, Indian Overseas Bank, the Oriental Bank of Commerce (now Punjab National Bank and the Bank of Maharashtra) by diverting/siphoning off funds, showing sales to overseas dormant entities, manipulating books of accounts, etc. It was also alleged that the accused misappropriated bank funds by giving advances to the entities which had not carried out business during last five to nine years and provided loans and advances to its related parties. It was further alleged that the accused violated the sanction terms and conditions.”

It was also claimed that the company had lent funds without approval of the consortium banks with the aim to siphon off the funds and deliberately entered into non-genuine transactions with related parties to renew/enhance its credit facilities from the lender banks. It was also claimed that the accused had misappropriated the value of closing stock as well as fixed assets and thus cheated the banks.

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