PMC Bank: Ex-MD Arrested; ED Raids Six Places, Registers Case
The Mumbai police was questioning Thomas in connection with the scam.
The Economic Offences Wing (EOW) of the Mumbai Police on Saturday, 5 October, froze the accounts of Joy Thomas, the former Managing Director of the beleaguered Punjab and Maharashtra Co-operative (PMC) Bank.
Thomas was arrested in connection with the alleged Rs 4,355 crore scam at the bank, and was remanded in police custody till 17 October on Saturday.
Earlier on Friday, Enforcement Directorate (ED) raided six locations in Mumbai and adjoining areas and registered a money laundering case to probe alleged fraud in the bank, news agency PTI reported.
Thomas was later summoned to the EOW office and arrested after questioning, a police official said.
ED Raids at Six Places
On Friday, the Enforcement Directorate raided six places in Mumbai and adjoining areas and registered a money- laundering case based on the FIR filed by the EOW in the PMC Bank case.
Based on a complaint filed by the RBI-appointed administrator of the bank, the EOW has registered the First Information Report under IPC sections 409 (criminal breach of trust by a banker), 420 (cheating), and 465, 466 and 471 (related to forgery) along with 120 (b) (criminal conspiracy).
HDIL Promoters Arrested Too
On Thursday, the EOW arrested chairman and managing director of Housing Development and Infrastructure Ltd (HDIL) Rakesh Wadhawan and his son Sarang in the case.
A court on Friday sent them to police custody till 9 October.
The EOW registered an FIR on Monday against senior officials of HDIL and PMC Bank for allegedly causing losses to the tune of Rs 4,355.43 crore to the bank.
Property of Rs 3,500 crore belonging to the company was seized by the EOW, a police official said.
HDIL-PMC Bank Link
The FIR filed by EOW named former PMC Bank chairman Waryam Singh, Thomas and other senior officials, besides the Wadhawan duo.
HDIL promoters allegedly colluded with the bank management to take loans from the its Bhandup branch in Mumbai, the FIR said.
Despite non-payment, bank officials allegedly did not classify these loans as non performing advances, and hid the information from the RBI.
They also allegedly created fictitious accounts of companies which were shown to have borrowed small sums of money and created fake reports to hide from regulatory supervision, the police said.
The bank, which has 137 branches and over Rs 11,000 crore in deposits, was put under restrictions last week after the RBI discovered financial irregularities.
According to sources, overall exposure of the bank to the financially stressed HDIL group is around Rs 6,500 crore or over 73 per cent of its advances, and all of it is not being serviced.
The Reserve Bank said on Friday that there was no reason to panic about the overall banking sector.
(With inputs from PTI)
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