India's federal police files case against former UCO Bank Chairman

Era Infra Engineering

14/04/2018 17:34

NEW DELHI, April 14 (Reuters) - India's federal police said
on Saturday it has filed a case against a former chairman of
state-run UCO Bank  UCBK.NS  and several business executives
alleging criminal conspiracy that caused a loss of 6.21 billion
rupees ($95.17 million).
    Police said officials at the bank had colluded with private
infrastructure firm Era Engineering Infra Ltd  ERCI.NS , and
investment banking firm Altius Finserve Pvt Ltd, to siphon bank
loans.
    The Central Bureau of Investigation (CBI) said in a
statement that Arun Kaul, the bank's chairman between 2010-2015,
had helped clear the loan.
    Kaul did not respond to Reuters' calls for comment. Era
Engineering and Altius Finserve did not respond to calls outside
of regular business hours. 
    The case reveals yet another banking fraud in India since
February when two jewellery groups were accused of using nearly
$2 billion of fraudulent bank guarantees, in what has been
dubbed the biggest fraud in India's banking history.
    That case put the banking sector under a cloud, with the CBI
unearthing a string of other bank frauds since then.
    In the UCO Bank case, it charged Kaul and several officials
and accountants at the two companies with criminal conspiracy
with an intention to defraud the bank of about 6.21 billion
rupees by diverting and siphoning loans, according to the
statement.
    "The loan was not utilized for the sanctioned purpose and
was secured by producing false end use certificates issued by
the chartered accountant and by fabricating business data," the
CBI said.
    The offices of the companies, accountants and the residences
of the accused are being searched, the CBI said.
    
($1 = 65.2500 Indian rupees)

 (Reporting by Sudarshan Varadhan; Editing by Sanjeev Miglani
and Clelia Oziel)
 ((Sudarshan.Varadhan@thomsonreuters.com; +911149548059;
Twitter: https://twitter.com/turvytopsy @turvytopsy; Reuters
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