Loan fraud: CBI books manufacturer for causing ₹80 crore loss to banks

The firm had allegedly used dubious financial statements to avail the loans but had later diverted the proceeds for non-sanctioned purposes, CBI sources said. The agency registered the case recently after the complainant, SBI, alleged irregularities from 2009 to 2021

Mumbai: The Central Bureau of Investigation (CBI) has registered a case against a Dahisar-based aluminium foil manufacturing company, its director and others, for allegedly causing a loss of ₹80 crore to a consortium of banks led by the State Bank of India (SBI).

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The firm had allegedly used dubious financial statements to avail the loans but had later diverted the proceeds for non-sanctioned purposes, CBI sources said. The agency registered the case recently after the complainant, SBI, alleged irregularities from 2009 to 2021.

The firm’s loan accounts with the SBI and Bank of Baroda had been declared Non-Performing Assets (NPA) in 2013 and 2021, respectively, which led to losses to them, CBI sources said.

The SBI had conducted a “fraud angle examination” in respect of the accounts of the firm, on the basis of which it declared its account as “fraud” in September 2019, the CBI source added. “The ‘fraud angle examination’ report disclosed that the borrower company and its promoters had allegedly availed the credit facility based on a manipulated stock book, financial statements with inflated figures, among others, to be able to draw a higher volume of amounts from the consortium banks,” the source said.

“Due to a stretched working capital cycle, the borrower company had started to face liquidity issues and since July 2010, the account was under continuous stress,” the CBI source said. In September 2011, a major fire was reported at the firm’s Silvassa plant, which contributed 90% of its operations, and the plant was shut down for three months,” the source said. “The amount became ₹80 crore after implying penalties on the principal amount.”