CBI files indictment against ex-chairman of Corporation Bank in fraud case – The New Indian Express

Through PTI

NEW DELHI: The CBI has filed a complaint against the former Chairman and CEO Ramnath Pradeep of the Corporation Bank and other officers in connection with the alleged loss of Rs 79 crore incurred by the bank due to a default in payment from a company, officials said on Friday.

In its indictment filed at ACMM Court, Esplanade, Mumbai, the investigative agency named SN Murthy Shankar, then managing director, and AP Shiva Kumar, then senior managing director, Corporation Bank, LCB, Mumbai , they said.

The agency had resumed the investigation into the bank’s complaint on June 16, 2017 against Parekh Aluminex Limited, its directors and chartered accountant (CA).

The company and the CA were indicted on December 28, 2020.

“It was alleged that the directors, accountant and others conspired and used various credit facilities to the tune of Rs 60 crore (approx) from e-Corporation Bank (now UBI). embezzled funds and allegedly deployed them in real estate and other unrelated business activities through loans / advances in different real estate projects, ”said CBI spokesperson RC Joshi.

He said an alleged loss of Rs 79.04 crore (approximately) was caused to the Corporation Bank.

It has been alleged that the officials of the Corporation Bank conspired with the managing director of the said private company and authorized the disbursement of Rs 59 crore (approximately) without confirming the drawing power of the Lead Bank, that is ie Indian Overseas Bank, and did not make any efforts to become a member of the consortium to secure the interest of the bank.

“It has also been alleged that Corporation Bank officials have also repeatedly extended the time limit for said private company to request a compliance notice from the main bank, inducting Corporation Bank into the consortium. the consortium, ”Joshi said.

Giving details of the alleged roles of Pradeep, Shankar and Kumar, the CBI alleged that its investigation showed that then CMD, e-Corporation Bank (Pradeep) would have authorized a working capital limit of Rs 60 crore (approx) to said private company. under the pretext of refusing three of the consortium’s existing banks to share the tightened limits, Joshi said.

“It was further alleged that the accused failed to seek confirmation from three banks on the reasons for refusing to take their part in the raising of the limits and sanctioned their part without ascertaining the factual situation of financial close and reconciliation status, ”Joshi said. noted.

The CBI alleged that the sanctioning of the said credit limit violated the bank’s lending policy.

“It is also alleged that the accused waived the condition of obtaining a notice of compliance from the main bank, thereby facilitating gain for the private company and causing losses to the bank. It was further found that the then Managing Director (Shankar) and the then Principal Managing Director, LCB, Mumbai would have been involved in the evaluation of the sanction proposal of the said private company, knowing full well that the loan applicant was not neither a director nor an authorized signing officer of the borrowing company, ”Joshi said.

It was also noted that the defendants were involved in the preparation of memoranda to modify the terms of the sanctions with regard to the said private company and did not verify the real situation of the working capital requirement of the private company with from the Lead Bank, he said. .

The accused did not comply with the amended sanction conditions and allegedly disbursed the loan without informing the main bank of the sanction.

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