NEW DELHI: Former CEO and MD of ICICI Bank Chanda Kochhar seems to be in trouble again.
Kochhar, along with 10 others, including ICICI Bank and Oriental Bank of Commerce (now Punjab National Bank), have been booked for allegedly cheating a private company by verifying a fake document.
The case dates back to 2009. After a protracted legal battle of more than a decade, the Patiala House Court on December 9 directed Delhi Police to register a case and begin the investigation.
Subsequently, the Economic Offence Wing on December 20 registered an FIR under various IPC sections, including cheating and criminal conspiracy, against ICICI Bank, Kochhar, Sandeep Bakshi (CEO & MD of ICICI Bank), Vijay Zagade (ex-manager of ICICI Bank), unnamed officials of ICICI Bank posted at Global Trade Services unit, Mumbai. The other accused are Atul Kumar Goel (MD & CEO PNB), KK Bordia (ex-GM of Oriental Bank of Commerce), Akhila Sinha (AGM, PNB), Manoj Saxena (AGM, PNB) and KK Bhatia (ex-Chief Manager of Oriental Bank of Commerce).
According to the FIR, accessed by this newspaper, lodged on the complaint of Shammi Ahluwalia, director of P&R Overseas Pvt Limited, also known as Tomato Magic, the accused allegedly conspired to project a fake ‘Letter of Credit’, offered by a ‘foreign bank’, as a genuine document and verified its legality. A Letter of Credit is a document from a bank guaranteeing payment to a seller under certain conditions.
The complainant had received an export order from a Russian buyer for the supply of 1,000 metric tonnes of Chinese tomato paste for $10 lakh. The amount was increased to $18.48 lakh for an additional supply of Iranian-origin tomato paste.
As per payment risk, the condition was that the order shall be premised on a 100% irrevocable ‘Letter of Credit’ issued by an ‘A’ class bank of international repute. In this case, ICICI was the advising bank.
Accordingly, the complainant received the ‘Letter of Credit’ through ICICI Bank purportedly issued by the Royal Bank of Scotland (RBS). However, later it was found out that the LoC was issued by a bank, named RBS Alliance, Moscow, which did not have a good track record in honouring its documentary credits.
“ICICI Bank fraudulently authenticated the LoC as issued by the Royal Bank of Scotland knowing well that it was from a Russian bank. The said LoC was amended thrice and ICICI committed the same mistake on all three occasions,” the FIR read.
As per the FIR, the ICICI Bank in May 2011, in one of its replies to the complainant tried to “escape responsibility” by giving “frivolous” and “untrue” answers. “The complainant forwarded the letter of May 2011 to accused No. 6, which was Oriental Bank of Commerce. Surprisingly, the bank did not challenge the stand taken by ICICI, thus, consented to the correctness,” the FIR stated.
The complainant alleged that it purchased goods from the packing credit availed by it, processed the same for exporting by three shipments, and ultimately suffered a wrongful loss of Rs 27.66 Crores.