PMC Bank fraud: EOW searches offices of 3 auditors, seizes documents

Cops look for quid pro quo between accused, CAs; suspect ₹30L-₹60L was paid to auditors

The economic offences wing (EOW) of Mumbai Police searched the offices of three arrested chartered accountants (CAs) as part of its probe into the ₹4,355-crore Punjab and Maharashtra Co-operative (PMC) Bank fraud case.

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Chartered accountants Jayesh Sanghani, 61, of Ashok & Jayesh companies; and Ketan Lakdawala, 50, of Lakdawala and Associates, were arrested on November 11, while Anita Shankar Kirdat, 48, was arrested on Tuesday.

“We have searched the offices of Sanghani and Lakdawala in Bhandup and Borivli. Many documents have been seized and are being scrutinised. Kirdat’s office in Bhandup is being searched. Their bank accounts have already been frozen,” said an officer from the EOW’s special investigation team (SIT).

Being statutory auditors, Sanghani and Lakdawala had carried out annual auditing of PMC Bank between 2005 and 2018-19. Kirdat being a concurrent auditor for PMC Bank had carried out day-to-day auditing more than 150 times, the EOW said. Instead of playing the role of watchdog, the auditors shielded the non-performing assets (NPA) of Housing Development and Infrastructure Limited (HDIL) from the Reserve Bank of India’s (RBI) scanner, the EOW said.

The three arrested auditors were appointed at the behest of the main accused in the case, PMC Bank’s former managing director Joy Thomas, ex-chairman Waryam Singh, and HDIL’s directors Rakesh Wadhawan and Sarang Wadhawan.

The three CAs conducted audits for the bank, but did not record any discrepancies in its financial affairs and shielded HDIL’s NPA accounts from the RBI for a long period.

This prompted EOW officers to verify the aspect of quid pro quo. EOW sources told HT that the three are suspected to have received between ₹30 lakh-₹60 lakh from the accused, for the ‘desired’ audit reports.

Police are questioning the arrested auditors to know on whose instructions they overlooked the massive irregularities in the bank. “We are checking if they were part of the larger conspiracy,” said an EOW officer.