Bank Fraud Rs. 4957 Crore: CBI Registers Case Against Mumbai Based Company on Allegations of Bank Fraud

The Central Bureau of Investigation(CBI) has registered a case against a private company based at Mumbai and others including its 04 Directors/Guarantors; unknown Public Servants and unknown private persons on a complaint from Bank of Baroda on the allegations of Bank fraud totaling Rs.4957.31 crore (approx) to the consortium of 17 banks.

The account of the aforementioned Private Company was classified as NPA on 31st Dec 2017. The accounts were then declared fraudulent by the consortium banks.

The company was in the business of developing infrastructure projects, which included designing, engineering, and executing/constructing complex, integrated water transmission and distribution projects, water treatment plants, mass housing projects, precast design and construction, road construction, and urban infrastructure, among other things.

It was also claimed that the accused diverted a large sum of money from the borrower company to its related parties and subsidiaries, and that the company later wrote off these advances. It was also claimed that the company used fictitious sales and purchase transactions to inflate its turnover. Furthermore, in order to obtain credit from the lender banks, the work-in-progress was allegedly inflated, and a large amount of Vender Liability was directly adjusted against the Customer Account without any supporting documentation.

Searches were conducted today at 4 locations including at Mumbai, Thane, etc. which led to recovery of several incriminating documents & articles.

The investigation is still ongoing.