Even after being exposed, loan fraudsters tried settlement deal

They assured bank prez and secy that they would sell real estate assets to repay loans

Published: 24th July 2021 06:26 AM  |   Last Updated: 24th July 2021 06:26 AM   |  A+A-

money fraud

(Express Illustrations)

Express News Service

THIRUVANANTHAPURAM: The key accused in the Rs 300-crore loan fraud at Karuvannur Service Cooperative Bank had planned to repay pending loans before December 31, 2020 and settle the issue before the situation worsened. The informal understanding between the employees who formed the cartel to siphon off depositors’ money and the director board had the blessings of CPM local leadership, it is learnt.

According to sources, suspended manager M K Biju assured bank president K K Divakaran and secretary T R Sunilkumar that all outstanding loans availed under benami names by him and other employees C K Jills and Bijoy will be cleared before the end of 2020. Another major defaulter, Kiran P Prakasan, also promised to clear his liabilities before the end of the last fiscal.

It is learnt that the discussion between the employees who availed illegal loans and a section of director board members took place in October 2020, soon after the assistant registrar-led probe panel finalised its report that had identified loan fraud worth `104.37 crore.

The inquiry report submitted to the joint registrar was shelved in accordance with the understanding reached between the accused and bank directors. “The plan was to sell some of their real estate assets and, in the worst-case scenario, the tourism projects in Thekkady and Munnar. It seems the deals didn’t work out because of Covid crisis and the economic slump.

The practice of availing loans under benami names, investing the sum in real estate and closing the loan after booking profit had been there for long,” said the source. Though the CPM Thrissur district committee had commissioned at least three party-level inquiries into the complaints against the director board, the leadership didn’t initiate disciplinary action based on the assurance given by leaders based in Irinjalakuda to settle the loans.

The investigation carried out by assistant registrar Omana K L during 2019-20 had scathing remarks against the director board and the secretary. Bank president Divakaran had aided the fraudsters at least in some cases, found the probe. Examining a loan availed by an employee, the probe panel found that the title deed of the land pledged as the collateral for the loan was released to Jills by the bank president, with a no liability certificate.

“When we examined the minutes of the meeting, such a decision was not seen cleared by the director board. It appears that the bank president aided the benami transactions by bank employees,” says the report. Sunilkumar, who had been the secretary of the Karuvannur bank, actively aided the fraudsters to siphon off at least Rs 300 crore, noted the probe report.

Accused won’t be protected: Pinarayi
T’Puram: The government has taken the Karuvannur bank fraud seriously and hence the director board was dissolved, Chief Minister Pinarayi Vijayan has said. A special team is investigating the case and the accused, irrespective of their political affiliation, will not be protected, he said. The party’s practice is to take strict action against party members, whichever post they occupy, for actions not befitting to the party, he said 

Fraud committed with CPM knowledge: Shafi
T’Puram: Opposition UDF on Friday walked out of the assembly after the Speaker rejected a notice for adjournment motion to discuss the bank fraud. Shafi Parambil, who moved the notice, said that the fraud was committed with the knowledge of CPM leadership. The party and the government covered up the issue even after the party’s district leaders identified it, he said. 

BJP lodges complaint with Amit Shah
Thrissur: BJP Irinjalakuda municipal committee on Friday lodged a complaint with Union Minister for Cooperation Amit Shah regarding the Karuvannur bank scam. BJP also sought the arrest of all accused in the cases, including the president and other director board members. 


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