The Economic Offences Wing (EOW) of the Mumbai Police registered an FIR against the senior officials of Punjab and Maharashtra Cooperative Bank (PMC) and Housing Development and Infrastructure Limited (HDIL) in connection with a fraud of over Rs 4,355 crores on Monday. The police said in a press note, “EOW has formed a special investigation team for the probe. The FIR has been registered on the complaint given by Jasbir Singh Matta, who was authorized by RBI administrator with Mumbai Police.”
According to the police, PMC Bank officials gave loans to HDIL between the year 2008 and August 2019 despite not paying the previous loans. The FIR was registered under Sections 409 (criminal breach of trust), 420 (cheating), 465 (forgery), 466 (forgery of record of court or public register), 471 (using a forged document as genuine) and 120B (criminal conspiracy).
On Friday, suspended MD Joy Thomas had admitted that the bank did not report the financial exposure to the Reserve Bank of India (RBI) for over six years. RBI had increased the withdrawal limit from Rs 1,000 to Rs 10,000 after several bank account holders protested against the move outside the Sion branch in Mumbai on September 27. A depositor can also not make any fresh deposits or extend any new loans. The RBI has said that 60% of the accounts have balances under Rs 10,000 and will not be impacted by the measures. Last week, the RBI had restricted activities of PMC bank citing major financial irregularities, failure of internal control and under-reporting of its exposures under various off-site surveillance reports.
Terming the Punjab and Maharashtra Cooperative (PMC) Bank crisis as an "eye-opener", Minister of State for Finance Anurag Thakur on Monday said the banking sector regulator RBI is looking into various aspects, including lapses on part of auditors. On the sidelines of an event organised by Punjab National Bank in New Delhi, he said, “The role of regulators is very important but at the same time, the role of auditors, directors, bank officials is equally important. And what they have been doing for last so many years and people responsible for it, I think regulator (RBI) is looking into this. At this stage, I would not like to say much to that. But the kind of media reports and articles have come, some of them are very shocking. I think it is very very important, an eye-opener for the banking sector... such instances should not take place at the outset. It also raises a question mark on the role of various people whether it is regulator, auditors, directors and other officials."
(With ANI inputs)