OPEN APP
Home >Industry >Banking >Bank of Maharashtra CEO held over ₹2,043 crore scam

Mumbai: The police arrested the chief executive officer (CEO) and an executive director of state-run Bank of Maharashtra (BoM) on Wednesday, accusing them of misusing their authority in making loans to a property developer.

Authorities have stepped up scrutiny of the state banking sector after a more than $2 billion fraud unearthed in Punjab National Bank, the second-largest state-run lender, this year.

BoM chief executive Ravindra Marathe and an executive director, Rajendra Gupta, were among six people arrested, police said. Among the rest are Sushil Muhnot, a former chairman and managing director of the bank, a manager at the bank, and a chartered accountant and an employee of D.S. Kulkarni Developers Ltd, police said.

As per the charge sheet filed by the Pune police in May, the total scam is worth 2,043.18 crore wherein the accused floated nine different firms to siphon off the funds collected from 33,000 investors and fixed-deposit (FD) holders who were promised good returns on their FDs.

Bank officials at the offices of Marathe and Gupta declined to comment.

Muhnot could not be reached, and calls to the developer’s headquarters were not answered.

Current and former officials at some other state lenders, including IDBI Bank, Indian Bank, Syndicate Bank and Canara Bank have been investigated over alleged loan fraud cases. State-run banks have reported 8,670 cases of fraudulent loans totalling 61,260 crore over five financial years up to 31 March 2017, RBI data shows.

Subscribe to Mint Newsletters
* Enter a valid email
* Thank you for subscribing to our newsletter.

Never miss a story! Stay connected and informed with Mint. Download our App Now!!

Close
×
Edit Profile
My ReadsRedeem a Gift CardLogout