CBI probe into KSCB irregularities likely

N.J. Nair

Lapses in sanctioning of loans and takeover of loans from other banks

Inquiry team collects evidence

THIRUVANANTHAPURAM: The charges of financial irregularities levelled against a former General Manager of the Kerala State Cooperative Bank (KSCB) may be referred to the Central Bureau of Investigation (CBI) for a thorough probe.

Official sources told The Hindu on Tuesday that the vigilance wing of State Bank of India (SBI) was conducting an inquiry into the allegations of financial irregularities against M.N. Radhakrishnan Nair while he was working on deputation as General Manager (Banking and Finance) in the KSCB during the tenure of the previous director board.

On detecting irregularities in sanctioning huge amounts as loans to individuals and institutions, the present director board of the KSCB had filed a complaint against Mr. Radhakrishnan Nair. A two-member team led by Deputy General Manager S.V. Vadhanam from the Hyderabad office of the bank visited the KSCB headquarters here and conducted a detailed inquiry into the allegations. The inquiry team is understood to have collected evidence pointing to his direct involvement in the sanctioning of loans and have detected irregularities including procedural lapses and violation of rules. These include sanctioning of fresh loans and takeover of loans from other banks which had become non-performing assets (NPAs). Cases of loans sanctioned to tourist resorts in Alappuzha and Kollam districts and certain cooperative institutions had been collected by the team. The NPA of the bank in this score has touched Rs.44.20 crore, sources said.

It was alleged that he had joined hands with the then Managing Director and members of the director board for sanctioning huge amounts in gross violation of the banking norms.

The brief stints he officiated as Managing Director too were allegedly utilised for flouting the norms. Once the inquiry team submits the report to the chief vigilance office in Mumbai, the bank may refer the case to the CBI for a detailed investigation, sources said.

According to the rules, financial irregularities committed by bank officials above Rs.1 crore may be referred to the CBI for a comprehensive probe. Earlier, the amount was fixed at Rs.25 lakh, but recently it was enhanced to Rs.1 crore. Considering the gravity of the charges, the cases being probed by the vigilance wing too may be referred for an exhaustive probe, sources said.