The police have been busy of late over banking frauds.

The police have been busy of late over banking frauds.

3 more banks complain of fraud; Rahul slams Modi on ‘Jan-Dhan Loot Yojana’

Modi 'most expensive chowkidar' in the world, says Congress

Agency Report | New Delhi | 24 February, 2018 | 09:40 PM

On the heels of the Great PNB Fraud comes three more frauds which the banks are now rushing to divulge to the investigating authorities. These are just the tip of the iceberg most likely as public sector banks are routinely milked by the rich and powerful in collusion with corrupt bank officials.

Three fresh incidences of financial fraud have come to light as the CBI filed cases against a jeweller, a businessman and a public servant on complaints by three different banks earlier this week, an official said on Saturday.

On Thursday, the Central Bureau of Investigation (CBI) registered a case against Delhi’s Karol Bagh-based diamond jewellery exporting firm Dwarka Das Seth International for an alleged bank loan fraud of Rs 389.85 crore involving the Oriental Bank of Commerce.

The CBI on Wednesday filed a case against businessman Amit Singla and others on a complaint of the Bank of Maharashtra for a loan through forged documents and its criminal misappropriation and use.

The same day, the agency also filed a case against Inder Chand Chundawat, then Senior Branch Manager in the Punjab National Bank (PNB)’s Barmer office in Rajasthan, for abuse of his official position.

Earlier, cases of major financial frauds involving Rs 11,300 crore by diamantaire Nirav Modi and Rs 3,695 crore by Rotomac owner Vikram Kothari surfaced, in which the CBI has filed cases and made several arrests.

After the PNB and the Bank of Baroda filed cases against Nirav Modi and Rotomac Global, the Oriental Bank of Commerce, the Bank of Maharashtra and Barmer office of the PNB rushed to the CBI as well with their complaints of fraud, leading to the agency filing three separate cases.

The Oriental Bank of Commerce has alleged that it was defrauded by Delhi jeweller Dwarka Das Seth International and its owner Sabhya Seth. The loans turned into non-performing assets (NPAs) way back in 2014, but the bank approached the agency on August 16 last year, after the company had folded up and Seth fled the country.

The CBI has started tracing India-based directors and partners of the company.

The Oriental Bank of Commerce complaint has alleged that the Dwarka Das Seth International took loans by way of letters of credit and other such credit facilities for gold jewellery export/import between 2007 and 2012 but failed to pay back.

A probe by the bank found that the company had indulged in round-tripping of funds through fictitious companies abroad and had utilised funds by discounting bills based on the letters of credit of foreign banks, which were either non-existent or had negative ratings.

“We feel that Sabhya Seth of Dwarka Das Seth International Pvt Ltd had orchestrated an elaborate plan to dupe the bank,” the bank said in its complaint.

Similarly, the Bank of Maharashtra has approached the CBI to lodge a loan default complaint against a Delhi businessman Amit Singla. The loan had turned into an NPA in 2013 and the bank has even sold a property kept as collateral to recover its dues, sources said.

The Bank of Maharashtra’s FIR names Singla, the proprietor of Delhi-based Ashirwad Chain Co, loan guarantor Roshan Lal Bhalotia, property valuation firm Tech Mach International and unknown officials of the bank.

It is alleged that Singla and his company took loans of Rs 9.5 crore through cash credit facility from the bank between 2010 and 2012. The accused allegedly submitted three properties in Delhi and Haryana as collaterals. The properties, at the time of taking the loan, were valued at over Rs 18 crore by Tech Mach International.

But, after the loans turned into NPAs, the actual market value of the properties were found to be only Rs 2.5 crore. One of the properties, a double-storied house owned by Roshan Lal in Rohtak, Haryana, was valued at Rs 4.85 crore while sanctioning the loan. When the bank sold it off to recover its dues, it fetched only Rs 73 lakh.

Similarly, a commercial property owned by the accused at Chandni Chowk in Delhi was valued by Tech Mach at the time of disbursal of the loans at Rs 4.95 crore, but it was actually worth Rs 31 lakh only.

Tech Mach was later removed from the panel of valuers by the bank.

In the complaint, the Bank of Maharashtra said: “The overvalued valuations were deliberately given in connivance with the borrowers and the guarantors … to fraudulently induce the bank to finance the borrower.”

The FIR also alleged that Singla had submitted inflated stock audit reports and balance sheets, apart from diverting the loans to sister concerns.

The PNB approached the CBI for a second time on Wednesday against one of its branch managers at its Barmer office in Rajasthan.

According to the complaint, the branch manager had defrauded the bank of over Rs 2 crore in 2011 and the bank had even suspended the official following an internal inquiry.
Congress President Rahul Gandhi on Saturday attacked Prime Minister Narendra Modi over the fresh alleged Rs 390-crore banking fraud saying that like Vijay Mallya and Nirav Modi, this promoter too has disappeared while the government looked the other way.

“Under Modiji’s ‘Jan-Dhan Loot Yojana’, another scam! 390 crore, involving a Delhi-based jeweller. Same Modus operandi as Nirav Modi. Fake LOUs,” wrote Gandhi in Twitter.

“Predictably, like Mallya and Nirav, this promoter too has disappeared while the Govt looked the other way,” he added with hashtag #ModiRobsIndia.
Senior Congress leader Kapil Sibal also slammed the Prime Minister’s silence on major banking scams unearthed in the country over the last few days and termed Narendra Modi the “most expensive chowkidar” in the world.

“Modiji used to give a statement every day against the Congress when a (2G) scam worth Rs 1.76 lakh crore was alleged during the UPA regime.

“That was a presumptive loss. Later, the court said there was no scam at all,” Sibal said while briefing the media here.

Referring to the banking frauds by diamond jeweller Nirav Modi (worth Rs 11,300 crore) and others (Rotomac loan default worth over Rs 3,000 crore) as “actual” losses, Sibal said: “Why is he (Prime Minister) silent now?”

Modi spoke about the bank fraud for the first time on Friday at the ET Global Business Summit saying the government would take “stern action” against irregularities.

“He (Narendra Modi) gets a house, a plane; he is the most expensive watchman in the world,” he added.

The former Union Minister said that the Prime Minister should explain why these scamsters “gained” while the nation faced losses under his watch.

“Several leaders in the Bharatiya Janata Party have connections with these scamsters, who have left the country,” he said. (IANS)