A bank fraud case was registered by Central Bureau of Investigation against a UP-based private sugar company on Sunday. The case is registered against the top officials of the bank along with unknown officials for allegedly causing loss of Rs 109 crore to Oriental Bank of Commerce, officials said.
CBI officials allege that in 2011, the Hapur-based Simbhaoli Sugars Ltd fraudulently diverted funds received as loans for sugarcane farmers and self-help groups. The investigative agency conducted searches at offices of the company and residences of its officials at eight places. Searches were conducted at one location each in Hapur and Noida, a total of six locations in Delhi.
“Searches are being conducted at eight premises including residences of Directors, factory, corporate office and registered office of the company in Delhi, Hapur and Noida,” said CBI spokesperson Abhishek Dayal.
The agency alleges that the case has been registered against the company’s Chairman and Managing Director, its Directors, CEO, Chief Financial Officer and unknown bank officials and other private persons. The charges levied on them were of criminal conspiracy, cheating, forgery slapping sections under Prevention of Corruption Act for causing loss to the bank.
As per officials, the Bank approved a loan amounting to Rs 148.60 crore in 2011 to the private company for financing individual, Joint Liability Groups, Self-Help Groups under the tie-up arrangement under the RBI Scheme to 5,762 sugarcane farmers supplying sugar produce to said private company during the period from January 25 to March 13, 2012. However, the company allegedly diverted funds for personal use.
According to the complaint, the account turned Non-Performing Asset (NPA) on March 31, 2015, and was later reported as an alleged fraud by the bank to RBI on May 13, 2015, for a number of Rs 97.85 crore.
Further, it was alleged that the existing NPA as on March 31, 2015, the bank, under multiple banking arrangements, had sanctioned another corporate loan of Rs 110 crore to the sugar company on January 28, 2015. The loan was sanctioned for the company to pay its remaining loan of Rs 97.85 crore, and altered the total liability of Rs. 112.9 crore of the said private company on June 30, 2016, by way of deposit of this new corporate loan.
However, the corporate loan, too became an NPA on November 29, 2016, thus resulting in its first outstanding loan of Rs 97.85 crore (as alleged fraud) and the corporate loan of Rs 109.08 crore (as fresh outstanding).
CBI is now investigating the matter, officials said.