CID to Probe Gold Loan Scam

The Criminal Investigation Department (CID) will investigate the gold loans advanced

Published: 25th July 2014 09:07 AM  |   Last Updated: 25th July 2014 09:07 AM   |  A+A-

BANGALORE:The Criminal Investigation Department (CID) will investigate the gold loans advanced by all 28 branches of the Shimoga District Co-Operative Central Bank. Some of these loans had been reportedly given against fake jewellery.

Cooperation Minister H C Mahadeva Prasad announced this on Thursday during a debate in the Council on the irregularities in the bank’s Shimoga City branch. Mahadeva Prasad admitted that a preliminary inquiry had revealed loans worth `40 crore had been given against fake ornaments in 486 of the total 4,522 gold loan accounts. Another `10 crore had been given without taking jewellery as guarantee.  “The CID will inquire into all gold loans advanced by all the branches, including the city branch. Our department officials will also inquire into all non-farming loan cases in all branches, and any irregularity found in the inquiry will be referred to the CID,” he said.

The minister said an inquiry was conducted by senior officials after they got an anonymous letter regarding the large-scale corruption in gold loans. The inquiry revealed that the city branch did not have an explanation for a shortage of `1.79 crore in its accounts. Subsequently, upon checking the gold loan cases, it came to their notice that the jewellery pledged to raise the loan were fake, and many loans had been given without jewellery.

Soon after this revelation, the department withdrew the rights of transaction given to three bank staff and transferred that power to others.

A criminal case was also filed against the three staff, including the branch chief manager and a senior assistant who were suspended. Mahadeva Prasad said show-cause notices have been served on the accused asking why action should not be initiated against them.

He said stern action would be initiated against them after they reply to the notice.


Disclaimer : We respect your thoughts and views! But we need to be judicious while moderating your comments. All the comments will be moderated by the editorial. Abstain from posting comments that are obscene, defamatory or inflammatory, and do not indulge in personal attacks. Try to avoid outside hyperlinks inside the comment. Help us delete comments that do not follow these guidelines.

The views expressed in comments published on are those of the comment writers alone. They do not represent the views or opinions of or its staff, nor do they represent the views or opinions of The New Indian Express Group, or any entity of, or affiliated with, The New Indian Express Group. reserves the right to take any or all comments down at any time.

flipboard facebook twitter whatsapp