HC orders CBI probe into Rs 81 cr fraud

The Madras High Court bench here has ordered a CBI probe into a Rs 81.67 crore fraud allegedly committed by some pulse traders against the Lakshmi Vilas Bank.
The traders had availed the money as loan over a period of time by fraudulently showing paddy husk bags as pulses stock (as collateral security). They failed to repay the money.
Observing that the money borrowed by the traders belonged to customers who had deposits in the bank, Justice S S Sundar directed the CBI to investigate the matter and submit a status report on December 5.
He was allowing a petition by the bank seeking transfer of the case from the local police in view of no progress.

In his yesterday's order, the judge rejected the contention of the Central Bureau of Investigation (CBI) that it was overburdened with work and hence, could not take up the case.
He also dismissed the argument by the police that no cognisable offence had been made out to enable them proceed further.

The judge said apparently it was a serious fraud and public money had been misappropriated.
Bank's vice-president M Rangarajan submitted that 27 traders from Madurai and four from Virudhunagar had borrowed Rs 71.62 crore and Rs 10.05 crore respectively, from the bank and defaulted in repaying the loan.
Though a complaint was given to the local police, no action was taken.

The loan was sanctioned on the basis of a certificate by a private firm, operating godowns for pulses, that the traders had stocked pulses with it.
The company 'Star Agri' later gave a complaint to the police that the traders had not stored pulses, but only paddy husk.
Though separate complaints were given to Virudhunagar Superintendent of Police and Madurai Police Commissioner on September 14, no action was taken against the accused.
The accused include S Suruli Velu, S Siva, partners in Sri Sharavana Traders and Selvarani Dhal Industries, and employees of Star Agri.