UCO Bank begins internal probe, conducts snap audit across Kolkata branches

Team of 36 officers makes surprise visits across 71 branches

State-run UCO Bank has started an internal probe to examine the functioning of its branches after West Bengal Infrastructure Development Finance Corporation and West Bengal State Co-operative Bank claimed that money was missing from their fixed deposit accounts with the bank.

A team led by Rajiv Yadav, general manager for inspection and audit at UCO Bank, has made surprise visits to 71 branches in Kolkata and its outskirts. The public sector bank currently has 75 branches in Kolkata.

"Snap audit was conducted across these branches by a team of 36 officers during the weekend. The officers have been selected from the across the country. The audit was conducted to examine if there is any weakness in the systems and processes of these branches. The findings are currently being examined by Rajiv Yadav and his team," a senior executive of the bank told Business Standard requesting anonymity.

He added that the Central Bureau of Investigation (CBI) has also sent a team from Delhi to investigate the matter. UCO Bank had referred the cases to CBI.

WBIDFC has alleged that it transferred Rs 120 crore in two separate transactions and opened fixed deposit accounts with UCO Bank's Circus Avenue, Kolkata branch. It claimed that the Circus Avenue branch had offered a higher rate of interest than other branches of UCO Bank.

While reconciliation of its accounts earlier this month, WBIDFC noticed that the money was missing from the fixed deposit accounts. The state government's infrastructure finance arm said the money was transferred to a proprietorship firm and filed a first information report (FIR) with the local police.

UCO Bank said the fixed deposit certificates of WBIDFC are fictitious and at no point of time these instruments were issued by the bank's Circus Avenue branch. The bank, however, suspended all the 12 employees of its Circus Avenue branch, pending enquiry.

West Bengal State Co-operative Bank has also made similar allegations. It claims Rs 20 crore is missing from its fixed deposit account with UCO Bank's Hastings, Kolkata branch. The bank has suspended five employees in this branch, pending investigation.

The bank, however, did not conduct the snap audits in Circus Avenue and Hastings branches. "CBI is already investigating those branches. Hence, those were excluded from the snap audit," the official said.