Rs 600 crore loan fraud: How top bankers helped in looting IDBI bank
The Rs 600 loan fraud involving IDBI bank is one of the classic examples of how the top management of IDBI bank looted their own bank. Apart from the then CMD of IDBI Bank MS Raghavan, the Central Bureau of Investigation (CBI) has also booked the current MD and CEO of Syndicate Bank MO Rego and Kishore Kharat, the current MD and CEO of Indian Bank.
After a reference of CVC, in a major crackdown against bank fraud, the CBI filed case against Aircel founder C Sivasankaran and three companies -- Axcel Sunshine Limited (British Virgin Islands) and Win Wind Oy (Finland) and 15 IDBI bank officials for defrauding the bank to the tune of Rs 600 crore.
Top officials of CBI have told India Today that, "in this case, bank never approached us to file a complaint. Top officials of IDBI bank helped the accused to defraud bank of Rs 600 crore."
According to CBI, in October 2010, IDBI sanctioned loan of Rs 322 crore to Win Wind Oy, a Finland-based company. The loan went NPA (Non Profitable Asset) in October 2013 after the company went bankrupt in Finland.
"Win Wind Oy is an associate company of Siva Investments and Holding Limited, a Seychelles-based company. Inspite of knowing about NPA, in February 2014, the IDBI bank gave loan of Rs 523 crore to Axcel Sunshine Ltd, which is based in British Virgin Island. This company is associate of Siva Group. This loan was used to repay loan of other companies of Siva Group," said a senior officer.
India Today has learnt that these loans were sanctioned because the top management of IDBI bank intentionally allowed to do so. The 15 officials of IDBI bank, who have been named in the FIR, "MS Raghavan, then CMD of IDBI, B K Batra, then DMD of IDBI, MO Rego, then DMD of IDBI and now serving MD and CEO of Syndicate Bank, PA Shenoy, then independent director at of IDBI, S Ravi, then independent director of IDBI, Niladkerpe, then independent director of IDBI, K Biju George, then and current GM of IDBI, Manoj Alex, then regional manager of IDBI and currently DGM of IDBI, Venka Krishnan, then and current GM of IDBI, Subrata Gupta, then CGM of IDBI and serving ED of IDBI, Vinney Kumar, then ED of IDBI, G Suneel Babu, then DGM IDBI and current GM of IDBI, B Rabrinathanath, then ED of IDBI and GM Yadwadkar, then ED now DMD of IDBI Bank and Kishore Kharat, then CMD of IDBI and now current MD and CEO of Indian Bank, Chennai.
"This is case of fraud of bank by the executives of the bank, promoters of the group of companies involved to derive wrongful gain and cause loss of Rs 600 crore to bank," said CBI official.
Meanwhile, over 50 teams of agency conducted searches at 50 places located across 10 cities which include Delhi, Mumbai, Faridabad, Gandhi Nagar, Chennai, Bangalore, Belgaum, Hyderabad, Jaipur and Pune.
The agency even registered a case against 39 accused under Sections 120-B, 409, 420 of Indian Penal Code and under Sections 13(2) read with 13(1)(d) of PC Act, 1988. CBI has booked then senior officials of IDBI, M/s Axcel Sunshine Limited, having its registered office at Porteullis Trust Net (BVI) Limited, British Virgin Islands, and others.
According to a senior officer of CBI, "We have lodged the case on the allegations of perpetrating fraud through the loan accounts of M/s. Win Wind Oy, Finland and M/s. Axcel Sunshine Limited to an extent of around Rs 600 crore."