India's biggest bank fraud case: The Central Bureau of Investigation (CBI) is carrying out searches at several places linked to ABG Shipyard in Mumbai in connection with the Rs 22,842 crores bank fraud case. ABG Shipyard is engaged in shipbuilding and ship repair. Its shipyards are located in Dahej and Surat in Gujarat
Biggest bank fraud case
It is the biggest bank fraud case registered by the Central Bureau of Investigation (CBI). Funds were used for purposes other than for which they were released by banks.
What's the case all about?
The bank had first filed a complaint on November 8, 2019, on which the CBI had sought some clarifications on March 12, 2020. The bank filed a fresh complaint in August that year. After "scrutinising" for over one and a half-year, the CBI acted on the complaint filing an FIR on February 7, 2022.
The company was sanctioned credit facilities from 28 banks and financial institutions with the SBI having exposure of Rs 2468.51 crore, they said. The Forensic Audit has shown that between 2012-17, the accused colluded together and committed illegal activities including diversion of funds, misappropriation, and criminal breach of trust, they said.
The accounts of the company were maintained at State Bank of India, Overseas Branch, Mumbai, where the fraud has occurred. The fraud has also taken place at the branches of the erstwhile State Bank of Patiala, Commercial Finance Branch, New Delhi, and State Bank of Travancore, Commercial Branch, New Delhi. The fraud has taken place through the diversion of funds, misappropriation, and criminal breach of trust with an objective to gain unlawfully at the cost of the Bank's funds. As per the forensic audit report conducted for a period between April 2012 and July 2017, the fraud has taken place during the period.
The fraud perpetrated by the accused persons came to light when a Forensic Audit was conducted for the period from April 2012 to July 2017. There was a demand for commercial vessels as the industry was going through a downturn even in 2015. Further, there was no fresh defense orders released in 2015. The company was finding it very difficult to achieve milestones as envisaged in CDR. Thus, the company was unable to service the interest and installments on the due date.
Who all have been booked?
The CBI has booked ABG Shipyard Ltd and its then Chairman and Managing Director Rishi Kamlesh Agarwal along with others for allegedly cheating a consortium of banks led by State Bank of India of over Rs 22,842 crore, officials said Saturday.
Besides Agarwal, the agency has also named the then Executive Director Santhanam Muthaswamy, Directors Ashwini Kumar, Sushil Kumar Agarwal, and Ravi Vimal Nevetia, and another company ABG International Pvt Ltd for alleged offences of criminal conspiracy, cheating, criminal breach of trust, and abuse of official position under the IPC and the Prevention of Corruption Act, they said.
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