MUMBAI: After the scam at a Chandigarh branch of IDFC First Bank wherein deposits worth close to Rs 600 crore of the Haryana finance department were siphoned off by a few bank and government employees last month, and a smaller Rs 47 crore of scam at AU Small Finance Bank, another fraud worth Rs 160 crore of fixed deposits of the Panchkula Municipal Corporation parked with a Kotak Mahindra Bank account has come to light.
The bank on Wednesday, without quantifying the amount, admitted that the money is missing and said it is doing the reconciliation of fixed deposits and linked accounts and has also filed an FIR with the Panchkula police.
In a statement, it also claimed that the affected accounts and transactions were handled according to the due process and regulatory requirements.
"Following instructions from the municipal corporation, we initiated a detailed reconciliation of fixed deposits and linked bank accounts maintained by the corporation. As part of this exercise, we have confirmed, based on records examined so far, that all account opening processes, KYC documentation, authorised signatories and instructions received from the Corporation were in order, and that the accounts and transactions were handled in strict adherence to due process and applicable banking norms.
"A significant portion of the amounts under review has already been reconciled with the Corporation, and the reconciliation process is continuing in an orderly manner. Further, to ensure that the matter is examined independently and comprehensively, we have filed a formal complaint with the Panchkula Police," Kotak Bank said a statement.
“Some of the FDs were with the bank for a long time in the Panchkula branch. Discrepancy was found when the bank was asked to transfer the funds on maturity of one of the FDs,” said Panchkula Municipal Commissioner Vinay Kumar according to PTI.
In the previous case of fraud at IDFC First Bank, the lender had on February 23 said that Rs 590 crore was siphoned off from a Chandigarh branch account of the finance department.
In a similar fraud, AU Small Finance Bank had also found Rs 47 crore of fraudulent transaction in a government account in the Haryana state capital in the same week.
Following the scam, the state government cancelled these two banks’ empanelment banking with government departments.
AU Bank also said it has initiated an internal review after the government had sought clarification regarding some suspicious transactions relating to one specific account by the finance department and a customer account.
Within days IDFC Bank returned the money to the government and an ACB probe is still underway.
Police arrested all the culprits-- Ribhav Rishi, Abhay Kumar, Swati Singla and Abhishek Singla.
According to the ACB, of the four arrested, two are government employees and the other two are ex-employees of the bank and they have allegedly defrauded Rs 300 crore to a private firm linked to them.
While Rishi headed the bank’s Sector 32 branch until about six months ago, Abhay was a relationship manager and resigned around last August. Swati Singla and her brother Abhishek Singla ran a partnership firm, Swastik Desh Project, which investigators say was used to route the diverted funds. According to Chawla, Swati holds a 75 percent stake in the firm and Abhishek owns the remaining 25 percent. Swati is also Abhay Kumar’s wife.