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CBI registers FIR against IL&FS Energy MD, directors over Rs 212.34 crore Canara Bank loan fraud
CBI has filed an FIR against IL&FS Energy Development Company and five executives over an alleged Canara Bank loan fraud. The agency alleges diversion of funds tied to a Rs 100 crore term loan and a $50 million foreign currency loan, causing a Rs 212.34 crore loss.
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The Central Bureau of Investigation has registered a case against IL&FS Energy Development Company Ltd and several of its former top executives over an alleged loan fraud that caused a Rs 212.34 crore loss to Canara Bank, officials said.
The FIR was filed on October 21 after a complaint from Canara Bank’s Circle Office in Bandra (East), Mumbai. The bank’s complaint relates to credit facilities that were originally sanctioned by the erstwhile Syndicate Bank, which has since merged with Canara Bank.
The CBI has named IL&FS Energy Development Company Ltd as an accused along with its managing director and directors: Sunil Wadhwa, Anoop Seth, Hari Sankaran, Ramesh Chandra Bawa and Arun Kumar Saha. The FIR also lists unknown public servants and private individuals.
Soon after registering the case, the agency carried out searches at multiple locations in Delhi, Mumbai and Noida, and said it seized documents it described as incriminating.
Loans from Mumbai and London branches
The case centres on a set of loans that the CBI says were obtained through a criminal conspiracy.
Investigators allege the company secured a term loan of Rs 100 crore from the Syndicate Bank’s Large Corporate Branch in Mumbai. Alongside it, the firm also availed a foreign currency loan of $50 million from the bank’s London branch.
The CBI’s FIR alleges the funds were not used for the purposes for which they were sanctioned. Instead, the money was diverted and siphoned off through associate entities, the agency has alleged.
That diversion, the FIR claims, resulted in a wrongful loss of around Rs 212.34 crore to the bank.
The case has been registered under sections that deal with criminal conspiracy and cheating, and also invokes provisions of the Prevention of Corruption Act.
The accused named in the FIR include the corporate borrower and five individuals who held senior leadership roles at the company. The agency has also kept the net open for other suspects by listing unknown public servants and private persons.
At this stage, the FIR sets out the allegations and the suspected route of funds, and marks the beginning of a criminal investigation. Searches and document seizures are typically used to secure records that investigators believe can establish how loan proceeds moved, who approved what, and whether the use of funds matched the terms of sanction.
The complaint that triggered the FIR came from Canara Bank’s Mumbai circle office, pointing to the bank’s internal assessment of the account and the alleged losses. Canara Bank absorbed Syndicate Bank in the consolidation of public sector lenders, making it the successor to the earlier lender relationship referenced in the complaint.
What happens next
With the FIR registered, the CBI can examine bank records, internal approvals, account statements and communications linked to the term loan and the foreign currency facility. Investigators are expected to scrutinise the role of the borrower’s management and any bank officials or intermediaries who may have been involved, given the FIR’s reference to unknown public servants.
The searches in Delhi, Mumbai and Noida indicate the agency is already collecting documentary material across jurisdictions connected to the company and the individuals named.
The CBI has not, in the material available, disclosed arrests, summonses or chargesheets. Those steps, if any, would come after the agency completes its initial evidence-gathering and records statements.
Sources
- ye ao\st 23May 30, 2023
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