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9 Charminar Bank directors among 22 arrested

Syed Amin Jafri in Hyderabad

In a major operation, as many as 22 accused persons, including nine directors, involved in the multi-million rupee Charminar Co-operative Urban Bank scandal, were arrested by the police and produced before the third metropolitan sessions judge in the city on Tuesday.

The judge, K Gaddenna, remanded all the accused to judicial custody for 15 days till April 16. They were sent to Chanchalguda central prison in the city.

The arrested persons include Syed Arif Hussain, Syed Akbar Hussain, Syed Ahsan Ali Zaidi, Syed Yousuf Abbas, S M Raza Abbas, Syed Mohammed Hamid Hussain, Syed Ali Abbas, Syed Ali Moosvi and Syed Hassan Abbas (all directors), C S Vishwanath Reddy (chartered accountant and former director), N H Naqvi (managing director), Suri Babu (deputy general manager, loans), Ms Mushraf Fatima (manager, loans) and Ashrafuddin (valuer).

Sleuths of the Criminal Investigation Department arrested all the accused on Monday evening on a complaint filed by the Registrar of Co-operative Societies. It may be recalled that the main case was registered on February 25.

The CID officials also arrested K P V Subbaiah and his relatives Uma Shankar, Ravi Shankar and Narasimha Moorthy and his employees Narasimha Rao, Shobhan Babu, U S Narayana and N T Babu and produced them before the judge for floating 11 bogus firms and defrauding the Charminar Bank.

Each of these fictitious firms was provided loans ranging between Rs 20 million to Rs 26 million.

Subbaiah and his bogus firms had taken total loans amounting to Rs 264.5 million by mortgaging 677 acres of agricultural land situated at Bodakonda and Nomula villages in neighbouring Rangareddy district.

The entire mortgaged land belonging to Subbaiah and his family members was actually valued at Rs 16.6 million by the sub-registrar during the year 2000.

The CID said that Subbaiah and his firms owed a total of Rs 301.9 million to Charminar Bank as on date and the total value of the properties mortgaged by them was only Rs 35.2 million at prevailing market rates.

Ashrafuddin, who was not even a licensed valuer, valued these properties located in a remote area at Rs 600,000 per acre as against their actual value of Rs 12,000 per acre.

Syed Alamdar Hussain Sajjad Aga, chairman of the bank who committed suicide in February, as well as the directors and bank staff conspired with the borrowers and accepted rural properties with highly inflated value as security.

They did not comply with the advise of the legal advisor of the bank. Most of the loans were released even before the title deeds were deposited. The mortgaged deeds were also bogus.

The scrutiny of the firms by the bank was superficial since 10 of these business establishments were not in existence.

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