Mumbai: Punjab and Maharashtra Co-operative Bank (PMC) used more than 21,000 fictitious accounts to hide loans it made, according to a police complaint lodged by officials, in the latest banking fraud case to spook the country’s depositors and investors.
The complaint, filed with the Economic Offences Wing (EOW) of Mumbai Police Monday, accuses the bank’s management of concealing non-performing assets and disbursing loans leading to a loss of at least 43.55 billion rupees.
A single realty firm and its group companies were the beneficiaries of 44 loans, according to the complaint. “The actual financial position of the bank was camouflaged, & the bank deceptively reflected a rosy picture of its financial parameters,” said the complaint, noting that the fictitious loan accounts were not entered into the bank’s core banking system – a factor key in the perpetration of a $ 2 billion fraud at Punjab National Bank that was uncovered in 2018.
The complaint names the bank’s Chairman Waryam Singh and its Managing Director Joy Thomas, along with other bank officials, and accuses them of criminal breach of trust, forgery and falsification of records.
It also names bankrupt realty company Housing Development and Infrastructure Ltd, along with its former senior executives Sarang Wadhwan and Rakesh Wadhwan, who were beneficiaries of the loans.
A senior government official late on Tuesday said that the serious fraud investigation office will look into the alleged wrong doing by HDIL in the PMC case, expecting to complete the investigation in the next two months.
The RBI last week moved to take charge of PMC with more than 900,000 depositors and suspended Thomas and the bank’s Board after uncovering lending irregularities.
