PMC Bank created over 21,000 fake accounts to hide defaults by HDIL: Sources

The Economic Offences Wings of city police disclosed the information while seeking custody of chairman and managing director of HDIL Rakesh Wadhawan and his son Sarang, arrested the day before.

Published: 05th October 2019 09:12 AM  |   Last Updated: 05th October 2019 09:12 AM   |  A+A-

PMC bank

Mumbai Police personnel stand guard outside Punjab and Maharashtra Cooperative Bank PMC at GTB Nagar in Mumbai. (Photo | PTI)


MUMBAI: Punjab and Maharashtra Cooperative (PMC) Bank replaced 44 loan accounts of the HDIL group with over 21,000 fictitious loan accounts, and thus "camouflaged" defaults by the group, the police told a court here on Friday.

The Economic Offences Wings of city police disclosed the information while seeking custody of chairman and managing director of Housing Development and Infrastructure Ltd (HDIL) Rakesh Wadhawan and his son Sarang, arrested the day before.

The court remanded them in police (EOW) custody till October 9.

The EOW has registered an FIR against senior officials of HDIL and the PMC Bank, including its former managing director Joy Thomas, for allegedly causing losses to the tune of Rs 4,355.43 crore to the bank.

"In the details of loan accounts submitted to the Reserve Bank of India for the year ended March 31, 2018, the PMC replaced the 44 loan accounts of HDIL and its group of companies, whose outstanding balance were significantly higher, with 21,049 fictitious loan accounts," the remand plea said.

These loans were not recorded in core banking system, instead, they were mere entries in the "master indent" (details of loan accounts) submitted to the RBI for inspection, the EOW said.

The bank's board of directors and executives, including managing director Joy Thomas, had "full knowledge" of this act, it said (Thomas was arrested on Friday).

ALSO READ | PMC Bank case: Former MD Joy Thomas arrested by Mumbai police; ED conducts raids

Through this forgery, bank officials "camouflaged" the real loan accounts of defaulters (HDIL group), the EOW said.

The Wadhawans played an active role in the commission of fraud, and their custodial interrogation was necessary to trace the operations carried out with the funds borrowed from the bank as well as to get in-depth information about businesses of the group companies, it said.

Properties of Rs 3,500 crore belonging to the company were seized by the EOW during an investigation, it told the court.

The alleged loan fraud at the PMC Bank came to light after the RBI found irregularities and imposed restrictions on the lender last week.

The Enforcement Directorate (ED) is also conducting a parallel probe under the Prevention of Money Laundering Act in the case, and on Friday it conducted raids at six places in and around Mumbai.


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