The CBI opened a criminal probe into the Rs 12.08 crore Bank of India fraud

 

Five officials of a private construction company are the subject of a criminal probe by the Central Bureau of probe (CBI). These officers are charged with defrauding the Bank of India, resulting in a ₹12.08 crore loss. 

 The executives allegedly broke key terms of the loan arrangement and misappropriated the bank's loan funds, according to CBI sources. After a complaint was submitted by the deputy general manager of the Bank of India's Asset Recovery Management Branch in Andheri West, the case became public knowledge. The CBI began its investigation as a result.

The Bank of India claims that the construction firm and its directors defrauded the bank by not depositing the sale proceeds from flats and shops in its Navi Mumbai real estate projects, as required by the loan agreement. 

The bank’s complaint states that instead of following the terms, the firm sold the properties without obtaining the necessary No Objection Certificates (NOCs) from the bank, which is a key condition.

The CBI has filed the case under sections of the Indian Penal Code and the Prevention of Corruption Act. These charges include criminal conspiracy, cheating, misappropriation of funds, and diversion of funds. 

According to the complaint, the bank’s loss due to this fraud was estimated to be ₹12.08 crore, as of December 2021. The CBI will investigate the bank’s credit transactions with the firm from July 2013 to December 2021, which were used to finance the company’s construction projects in and around Navi Mumbai.

The bank claims that according to the loan’s terms, the construction firm was supposed to obtain NOCs from the bank before selling any of the flats or shops in their projects. Additionally, the sale proceeds were supposed to be deposited with the bank. However, the firm failed to comply with these conditions, as stated in the bank’s complaint.

Loan Account Classified as Non-Performing Asset

The firm’s loan account was marked as a non-performing asset (NPA) on March 31, 2016, following standard banking procedures. Later, a demand notice was issued under the SARFAESI (Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest) Act, 2002. The loan was also officially classified as “fraud” in September 2024 by the Competent Authority, in line with a Supreme Court ruling from 2023.

The CBI’s investigation is continuing as it looks into the full extent of the financial wrongdoing and the involved officials’ roles in the matter.