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Bank Fraud: CB Probes Role of Top UCB Officials

Crime Branch is yet to register a case since it is assessing the documents provided by the Cooperative Department in this regard.

Published: 24th July 2015 05:47 AM  |   Last Updated: 24th July 2015 05:47 AM   |  A+A-

BHUBANESWAR: The Crime Branch (CB), which has taken over probe into the financial bungling in Bhubaneswar Urban Cooperative Bank (B-UCB), is examining the role of top management from 1988, when the bank was established, till it was shut down.

The CB is yet to register a case since it is assessing the documents provided by the Cooperative Department in this regard.

Initially, the CB had started the probe by analysing the Vigilance investigation into the financial bungling but found that 19 cases registered by the latter pertained only to individual loans which had turned bad.

The State Government had asked the CB to probe the reasons which had led to the liquidation of the bank which was initially reporting profit before its financial health deteriorated. From 2001 onwards, the bank started to sustain losses and even equity infusion by the Government did not work. Later, the merger plans also failed.

“We are looking into accounts to check the decisions made during the tenure of top management of the bank as well as branch managers to fix responsibility. In a number of cases, the financial decisions were flawed while near and dear ones of those who held top position also found favours,” sources said.

The UCB owes about Rs 28 crore to its depositors while it has failed to recover Rs 35 crore, including Rs 19 crore as principal, from loanees. The bank’s customer base was about 14,000.

The Reserve Bank of India, in 2004, imposed strictures on the operations and directed its liquidation. In 2007, the Government tried a merger deal with a Pune-based firm but it fell through. Another attempt in 2013 also failed.

The CB sources said a case will be registered once it has drawn up the list of people responsible for the mess.

Meanwhile, the Economic Offences Wing on Thursday carried out a test-check at the office of Smarudhha Jeevan Multi-State Cooperative Society following allegations of cheating.

The cooperative society’s Nayapalli officer was searched by an EOW team to verify if the firm went beyond its mandate to seek deposits from the public. Multi-state cooperative societies can take deposits only from its members. In fact, Samrudha Jeevan is one of the 44 chit fund firms which are under the scope of probe of the Central Bureau of Investigation.

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