Bank of India Fraud: Masterminds Behind Forged Letter of Credit Scheme Sentenced

In a major crackdown on financial crime, a Mumbai court has sentenced four individuals to jail for their involvement in a Bank of India fraud case involving a forged Letter of Credit that caused a loss of over Rs 3 crore.

Key Points

A special CBI court sentenced two individuals to five years' imprisonment for their role in a Bank of India fraud involving a forged Letter of Credit.
The Bank of India suffered a loss of over Rs 3 crore due to the fraudulent Letter of Credit scheme.
Harit Mehta and Abhay Mehta received five-year jail terms, while Manojkumar Mathur and Ilesh Shah were sentenced to three years.
The accused were found guilty of cheating, forgery, and criminal conspiracy under the Indian Penal Code.
The case involved a forged Letter of Credit purportedly issued by HDFC Bank, which led to the fraudulent transfer and withdrawal of funds.

A special CBI court here on Wednesday sentenced two persons to five years' imprisonment and two others to three years' jail term in a 2012 case where the Bank of India had suffered a loss of more than Rs 3 crore due to a forged Letter of Credit.

Harit Mehta, proprietor of Infinity Transmission, a private firm, was sentenced to five years in jail and asked to pay a fine of Rs 3.50 crore.

The director of the firm Abhay Mehta was also sentenced to five years' rigorous imprisonment with a fine of Rs 1 crore.

Former bank official Manojkumar Mathur, and another accused named Ilesh Shah got three years' jail term with a fine of Rs 50,000 each.

Special judge Amit Kharkar found the accused guilty under Indian Penal Code sections 420 (cheating), 467 (forgery of valuable security), and 120-B (criminal conspiracy).

Mathur, then a senior manager with the Bank of India (BOI), was accused of entering into a criminal conspiracy with the others.

Details of the Forged Letter of Credit Scheme

As per the CBI, the Nariman Point branch of the nationalised bank received a Letter of Credit (LC) dated July 20, 2009, purportedly issued by the HDFC Bank on behalf of Jayant Agro Organic Limited for discounting. The beneficiary was Infinite Transmission.

The branch discounted the LC for Rs 3,55,32,000 and Rs 2,47,12,213 was remitted in the account of Infinite Transmission.

Abhay and Harit Mehta then withdrew the amount. But later it was found that the LC had been forged, causing BOI a loss of Rs 3.4 crore, the central probe agency told the court.

Special prosecutor Jeetendra Sharma argued that Mathur, holding charge of the Forex department of the bank, dishonestly discounted the forged LC.

A total of 32 witnesses were examined during the trial.

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