Arunchal bank scam: BJP demands probe | india | Hindustan Times
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Arunchal bank scam: BJP demands probe

The bank's internal checks and control system were ineffective with many incidents of fraud.

india Updated: Dec 15, 2005 21:16 IST
PTI

The Opposition BJP in Arunachal Pradesh on Thursday demanded a thorough inquiry into the multi-crore scam in the state-owned Apex Cooperative Bank.

The party alleged that the statements by four elected directors of the dissoled bank board on Wednesday gave the impression that grant of loans and cash credit sanctions were mostly made by state government-nominated directors.

The BJP said in a release that the 'unchecked tendency' of granting such loans went on to such an extent that the bank collapsed and most of its 32 branches became non functional due to non-recovery of outstandings totalling Rs 170 crore.

The bank's internal checks and control system were ineffective with many incidents of fraud, the party alleged.

The party demanded that the state government reform the administration of the bank and announce a financial package to put it back on track.

All four elected directors of the dissolved board had demanded a CBI inquiry into the affairs of the bank and its functioning since its inception in 1978.

They alleged that the board of directors before its disolution took a decision to publish the names of loan defaulters, but the decison was never implemented.

They said relatives of ministers and powerful persons and some officers of the bank were among the defaulters and crores of rupees were given by the bank to them violating rules.

They said serious charges of mismanagement and irregularities had been levelled against them by the Registrar of Cooperative Societies, but before they could reply the board was dissolved.