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Scam blues for LIC housing staff after CEO arrest

Last updated on: November 29, 2010 14:29 IST

Scam blues for LIC housing staff after CEO arrest

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Dipta Joshi in Mumbai

Last Wednesday, Ramchandran R Nair, chief executive officer of LIC Housing Finance (LICHF), was taken away by sleuths of the Central Bureau of Investigation (CBI) while his entire office watched in shock.

When Business Standard visited the office on Friday, it was clear things were still to settle. One caught incoherent mumbling while customer relation executives were interacting with clients.

Some called it 'sheer bad luck' for Nair, others talked of a conspiracy.

A leader in housing finance, LICHF has a loan book of Rs 43,385 crore or Rs 433.85 billion (September-end), among the top five in the segment. In tough times, the mettle of an organisation is tested.

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Scam blues for LIC housing staff after CEO arrest

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So, how does one of India's largest housing finance company cope with a scam involving its CEO, of taking bribes from realty companies for okaying loans?

On the face of it, it was business as usual at the offices, with employees looking forward to the new CEO, V K Sharma's arrival on Monday.

Located in Fort, Mumbai's business district, employees at the loan disbursal office seemed to find it hard to believe that their CEO was involved in such a scam. One hinted at a possible conspiracy: "There are so many officers who need to sign the file before it can actually go to the CEO's table for approval."

After dismissing the episode with a one-liner - 'He is the fall guy' - she got back to explaining projects that a customer could look at.

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Image: Inset: V K Sharma.

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The next stop was the head office in the same area.

A fear psychosis was palpable here. Quite a few reporters were waiting there to meet someone, anyone.

An older employee told the receptionist, "Bolo, sab koi meeting mein hain" and walked away.

But persistence paid. If officials were to be believed, there hadn't been any internal communication regarding the change of guard or stricter scrutiny for project approvals.

Employees said they'd been keeping abreast of the latest developments only through the newspapers.

They were working overtime to assure customers of continued good service.

"Both  the customers and its employees' trust in the organisation need to be taken care of at times of crisis," said an official.

More such strategising can be expected once the new CEO settles in over the next few days.


Image: R R Nair, the tainted MD and CEO of LIC Housing Finance.

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