Loan scam: CBI traces 20 shady deals

The Central Bureau of Investigation (CBI) has traced 20 loans that various corporations secured after allegedly bribing five officers of the Life Insurance Corporation (LIC) of India and leading banks. The officers were arrested last week.

The Central Bureau of Investigation (CBI) has traced 20 loans that various corporations secured after allegedly bribing five officers of the Life Insurance Corporation (LIC) of India and leading banks. The officers were arrested last week.

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Over Rs 2,000 crore was loaned to corporations, and the CBI is investigating whether more loans were secured through bribes, said a senior officer requesting anonymity as he is not authorised to speak to the media. “Of the Rs 2,000 crore, Rs 600 crore was diverted to the stock market by the corporations through five bulk deals,” the officer said.

The CBI spotlight is on the five bank and LIC officers and three executives of Money Matters, a financial services firm that helped corporations secure the loans. The corporations allegedly paid the bribes with Money Matters’ executives acting as a go-between.

Five of the loans were secured through LIC Investment, five through LIC Housing Finance, four through Central Bank of India, three through Punjab National Bank and three through Bank of India.