Mudra Compass

The Enforcement Directorate (ED) has detained the principal culprit in the Pulpally Service Cooperative Bank fraud case

The Directorate of Enforcement (ED) has apprehended Sajeevan Kollapallil in connection with an ongoing money laundering investigation linked to the Pulpally Service Cooperative Bank in the district. This inquiry was initiated by the ED based on an FIR filed by the Vigilance and Anti-Corruption Bureau in Wayanad against the bank’s governing body members and officials.

The ED’s investigation has uncovered that bank officials and governing body members approved loans without the applicants’ consent and knowledge, inflating the value of collateral properties. They also approved excess amounts, which were diverted and credited to Sajeevan’s account at the bank. These loans were not repaid by the applicants, resulting in a loss of ₹5.62 crore for the bank.

Sajeevan was presented before the Special Court under the Prevention of Money Laundering Act in Kozhikode, where the court granted custody to the ED until Saturday.

Previously, Sajeevan had been arrested by the Pulpally police in connection with the death of a farmer who had filed a complaint in the fraud case. He was also arrested based on a case filed by an elderly couple in Pulpally who accused certain bank directors of deceiving them and alleged that Sajeevan was the mastermind behind the scam.

In connection with the bank fraud, the police had also arrested K.K. Abraham, the former general secretary of the Kerala Pradesh Congress Committee and former bank president; K.T. Ramadevi, the bank’s secretary; and V.M. Poulose, a former bank director and the Congress mandalam committee president in Pulpally.

Sajeevan’s name was mentioned in the suicide note left by the farmer, and he is also facing charges in multiple vigilance cases related to the bank fraud.

Fino Payments Bank reports that KPMG has identified unauthorized activities and misrepresentation involving certain employees

Fino Payments Bank, which hired KPMG to conduct an independent investigation into alleged fraud involving some of its employees, has reported that the initial findings suggest unauthorized actions and misrepresentation by the implicated staff members. Additionally, the bank has raised concerns about potential contributory negligence or collusion on the part of the complainants, as they may have overlooked irregularities and deviations from the bank’s standard procedures.

Although the investigation is ongoing, the bank has stated that it will not bear any liability in this matter. The bank received complaints from clients and distributors in Mumbai and Gujarat, alleging that certain employees had devised fictitious schemes and failed to disburse related funds.

Importantly, none of the complainants have taken legal action against the bank regarding the recovery of their funds. Fino Payments Bank had proactively engaged KPMG to conduct a thorough independent investigation, and based on KPMG’s preliminary findings, the bank has filed police complaints.

The Central Bureau of Investigation (CBI) has filed a case against Visa Power for a banking fraud amounting to Rs 1,964 crore

The Central Bureau of Investigation (CBI) has filed a First Information Report (FIR) against Visa Power and its former chairman, Vishambhar Saran, in connection with an alleged bank fraud totaling Rs 1,964 crore. The CBI’s action was initiated based on a complaint from Punjab National Bank (PNB), one of the 14 lenders in a consortium that had sanctioned term loans amounting to Rs 1,964 crore for the project. PNB was the lead bank in the consortium and approved a loan of Rs 394 crore.

According to the allegations, the company and the accused individuals, including Saran and directors Vikas Agarwal and Subrato Trivedi, approached the bank to secure loans for the development of a coal-based thermal power project with a generation capacity of 1,200 MW in Raigarh, Chhattisgarh.

The FIR states, “It has been revealed that the accused persons, in collusion and as part of a criminal conspiracy, have gained financially at the expense of the banks, causing a loss of Rs 1,964 crore, in addition to interest dues from the date of the account turning non-performing.”

The power project was to be executed in two phases of 600 MW each and was intended to be financed through the consortium of lenders. However, it was declared a non-performing asset (NPA) between 2015-16 due to various factors, such as the failure of promoters to contribute their share, the expiration of coal linkages, the expiration of the power purchase agreement, and delays in environmental clearance, among others.

The complaint from PNB alleges, “It is evident that the accused individuals conspired against public sector banks with the intent to deceive them by diverting and misappropriating funds, committing various offenses under relevant provisions of the Indian Penal Code.”

PNB has already issued a look-out circular against the accused individuals.