New Delhi: Police said they had registered a case against the chief executive of US banking giant Citigroup and other board members over a fraud case uncovered at a local Indian branch on Wednesday.
The case was registered after an Indian businessman who had lost money in the fraud filed a complaint against Citigroup’s India-born CEO Vikram Pandit and 10 other senior managers of the global financial services group.
“Falsification of accounts, breach of trust and criminal conspiracy are the key charges levelled against the 11 bank officials,” senior police officer S.S. Deswal said.
Last week, police arrested Shivraj Puri, a bank employee in the Citibank branch in Gurgaon, a suburb of capital New Delhi, who is accused of duping investors and diverting more than $88 millions.
Sanjeev Aggarwal who filed the complaint against the Citigroup executives, said the fraud “points to a systemic failure” in the company. “The entire organisation is responsible, hence I have named Pandit(CEO)” Aggarwal who claims he has lost his life savings said.
The US-based executives named in the case include Pandit, chairman William R. Rhodes, chief financial officer John Gerspach and chief operating officer Douglas Peterson.
Sanjay Gupta, associate vice president at India’s biggest motorcycle maker, Hero, has also been arrested by police on charges of criminal conspiracy in the fraud case.
Deswal said the alleged fraud came to light when one of the bank’s clients mentioned the scheme to a senior manager.
Investigations have revealed that employees at the bank in Gurgaon, where many international companies are based, had forged letters to divert funds and sell fake investment schemes.
“We are still trying to understand the exact modus operandi as money was diverted through several channels,” Deswal said, adding: “Many more arrests could be expected in the case.”
In November, several executives of state-run banks and an insurer in Mumbai were also arrested over alleged bribes totalling more than $200 millions paid to sanction loans to property developers.