CBI Files FIR After Canara Bank Alleges Loan Fraud of Rs 500 Cr

The CBI booked Kolkata-based PR Infosystems and its directors in relation to the case on Wednesday, 28 January.

Published
India
2 min read
CBI Files FIR After Canara Bank Alleges Loan Fraud of Rs 500 Cr

After the PNB scam came to light, yet another rot in the Indian banking system has been revealed with State-run Canara Bank accusing a Kolkata-based company of siphoning off Rs 500 crore taken as loan amount through fraudulent means.

The CBI has booked PR Infosystems and its directors in relation to the case on Wednesday, 28 January.

The bank in a statement said that the company had defrauded the colossal amount through false stocks, receivables and debtors’ statements, while also defaulting on the loan amount by diverting it.

The statement, accessed by the The Indian Express, reportedly alleged that:

… letters of credit (LCs) opened by different member banks of the consortium on the applications of M/S RP Infosystems Ltd started devolving from 2012 onwards due to non-maintenance of funds. The said borrower company dishonestly and fraudulently did not route the sale proceeds through the loan account and siphoned off the entire amount. 

The statement also alleged that the the company inflated the value of the receivables. In fact, some of the debtors mentioned by the company such as GAIl India and CEAT Ltd came out to say that they never had any dealings with the company.

The consortium of banks mentioned in the statement include Punjab National Bank, State Bank of Bikaner and Jaipur, Union Bank of India, Allahabad Bank, Oriental Bank of Commerce, Central Bank of India, State Bank of Patiala and Federal Bank.

According to The Indian Express, Shivaji Panja, one of the directors, was once a close aide to West Bengal CM Mamata Banerjee, and had earlier been arrested by the state police in 2015.

In February 2015, Panja was returning from Dhaka with Banerjee when he was arrested by the police on the basis of a lookout circular issued by the Economic Offences Wing for a similar crime.

The daily reported that Banerjee had swiftly distanced herself from Panga.

Months later, in June 2015, Panja and RP Infosystems were booked by the CBI for committing a similar loan fraud amounting to Rs 180 crore off the IDBI Bank.

Apart from Panja, the CBI has arrested Kaustuv Ray and Vinay Bafna (both directors in the company) and Vice President (Finance) Debnath Pal. Ray and Bafna were allegedly involved in the 2015 scam as well.

The agency has also arrested several unknown officials from Canara Bank, reported The Indian Express.

The current FIR filed by the CBI mentions a similar modus operandi as the one allegedly followed by the company in 2015.

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