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CBI books former CMD of UCO Bank in Rs 621-cr fraud case

Press Trust of India  |  New Delhi 

The has booked former chairman-cum-managing of Kaul and others in connection with an alleged Rs 621-crore loan fraud which has caused a loss of over Rs 737 crore to the bank, officials said today.

The agency carried out searches at 10 locations today, they said here.

Besides Kaul, the booked Era Engineering Infra Ltd. (EEIL), its CMD Hem Singh Bharana, two accountants -- and -- and Pawan Bansal of among others, they said.

It is alleged that the accused persons in pursuance of a criminal conspiracy defrauded the to the tune of about Rs 621 crore by diversion and siphoning of the loans, they said.

Kaul, who was the CMD of a Kolkata-based bank between 2010 and 2015, allegedly facilitated the accused company in obtaining the loan, they said.

The loan was secured by producing false end-use certificates issued by the and by fabricating business data. The loan was not utilized for the sanctioned purpose, the alleged.

"Searches are being conducted at 10 places (8 in and 2 in Mumbai) including the office premises of the companies, accountants and the residence of the aforesaid accused persons," the CBI said.

In its complaint, now part of the CBI FIR, the bank alleged that two loans were issued to the company in 2010 -- Rs 200 crore in March and Rs 450 crore in October.

The Rs 200-crore loan was issued for repayment of high cost debt to Central Bank of India, and It was found that the company did not utilize the amount for the purpose for which it was disbursed and diverted the funds.

"No amount was used to repay the dues of Central Bank of and while only Rs 59 lakh were repaid towards dues of while purpose of the loan was to repay the dues of these banks," it said.

Chartered dishonestly and fraudulently did not mention the details of utilisation of term loan in the end-use certificate.

In the case of the Rs 450-crore loan, too, the funds were utilised for purposes other than stipulated in the sanction and the end-use certificates given by the chartered account were intentionally ambiguous and against the fact, it alleged.

"The account was declared NPA as on July 7, 2013 by the bank and the present balance as on December 31, 2017 is Rs 737.88 crore," it alleged.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Sat, April 14 2018. 20:30 IST