CBI probes firm accused of duping Union Bank of ₹21 crore

The CBI on June 12 received the bank’s written complaint against the firm, accusing it of defrauding it to the tune of ₹21 crore in pursuance of a criminal conspiracy with unknown public servants and unknown private persons during the years 2008 to 2018, a CBI source said

Mumbai: The Central Bureau of Investigation (CBI) has initiated an investigation into a Mumbai-based metal-trading firm that is accused of cheating the public-sector Union Bank of India to the tune of around ₹21 crore.

An unidentified official enters the building as an idol of Hindu god Ganesha is seen placed outside the entrance of Central Bureau of ) (AP)

The forensic audit of the loan account, which turned into a Non-Performing Asset (NPA) in October 2018, revealed the alleged existence of several suspicious transactions, including those with suppliers who were paid without receipt of goods, CBI sources said. The forensic audit of the loan account was conducted by the bank, which is the complainant in the case.

The CBI has registered an FIR against the firm and unknown public servant/s under sections of the Indian Penal Code and Prevention of Corruption Act related to offences including cheating, dishonestly inducing delivery of property, criminal misappropriation of property, criminal conspiracy and criminal misconduct by public servants. The irregularities in the loan account took place between 2008 and 2018, agency sources said.

The CBI on June 12 received the bank’s written complaint against the firm, accusing it of defrauding it to the tune of ₹21 crore in pursuance of a criminal conspiracy with unknown public servants and unknown private persons during the years 2008 to 2018, a CBI source said. The sum was arrived at after deducting the amount of ₹18.12 crore received against a one-time settlement done with the borrower.

The firm was set up in 2001 and undertook trading in steel scrap as well as finished steel products through another firm in which the former’s proprietor was a director. “Due to continuously remaining out of order, the loan account turned NPA in October 2018 after which a recall notice was sent. Later, a notice under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act, 2002, was sent,” the source said. The account was declared a Red Flag Account (RPA) by the bank in February 2019.

“The forensic audit of the said account revealed irregularities and suspicious transactions. The bank alleged that in October 2018, around ₹4.58 crore was given as advance to various suppliers but neither were goods received nor was the amount recovered,” the source said. “There were allegedly also instances of sales where invoices were not accompanied by the required receipts, which made them suspicious. Transactions were mainly with related parties.”