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Rediff.com  » Business » OBC files criminal complaints with CBI

OBC files criminal complaints with CBI

By BS Economy Bureau in New Delhi
January 04, 2005 10:49 IST
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Oriental Bank of Commerce has filed criminal complaints with the Central Bureau of Investigation against five companies and some employees of the erstwhile Global Trust Bank.

The entities against which criminal complaints have been filed for alleged financial irregularities of over Rs 172 crore include, Unitel Software, Ashok Advani of Business India Publications, Shonk Technologies International, Petro Energy Products Company, Pearl Distilleries, a finance ministry press release said.

OBC is expected to lodge more complaints after examining other cases.

"High degree of imprudence in the exercise of sanctioning powers have been observed, where the bank appears to have abetted certain group of borrowers to siphon funds through banking channel.

"The conduct of most of these accounts reveal that deliberate attempts have been made to camouflage the position of non-performing assets by making fresh sanctions in sister/allied concerns including some front companies," said the release.

The release added that a case against Unitel Software was filed for allegedly causing a loss of Rs 6.77 crore (Rs 67.7 million).

The CBI registered a case against Advani and unnamed GTB executives for allegedly cheating the bank to the tune of Rs 15 crore (Rs 150 million) by obtaining credit facilities on the basis of misrepresentation.

"It was falsely mentioned in the process note that the account of M/s Business India was a new one, whereas Business India was banking with the erstwhile GTB since 1994 and had defaulted in payment of credit facilities sanctioned earlier," the release said.

OBC has alleged that Shonk Technologies International caused a loss of Rs 38.49 crore (Rs 384.9 million) to the erstwhile GTB on the basis of misrepresentations and diversion of funds for purposes other than for which the loan was sanctioned.

In a statement Shonkh said, "The company had availed of some financial assistance from the erstwhile GTB, which is a subject matter of dispute.

The erstwhile GTB has already filed a suit for the recovery of the disputed amount with the Debt Recovery Tribunal, Bangalore. The matter is sub-judice and there is no criminality involved in it. As of now we have not received any such notification from the concerned authorities."

In its complaint regarding Pepco, OBC said the company cheated the erstwhile GTB of Rs 78.41 crore (Rs 784.1 million) at its Bandra branch and Rs 23.15 crore (Rs 231.5 million) at its Chennai branch. Pearl Distilleries is alleged to have caused a loss of Rs 10.28 crore (Rs 102.8 million) to OBC.

The other entities mentioned could not be contacted for this story.
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BS Economy Bureau in New Delhi
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