CBI files chargesheet against former CMD of PSU Bank

 The Central Bureau of Investigation (CBI) has filed a charge sheet against Alok Kumar Misra, the former chairman and managing director (CMD) of Bank of India (BOI) and Oriental Bank of Commerce (OBC), along with 33 other individuals and companies. This charge sheet is related to the alleged bank fraud committed by Dewan Housing Finance Ltd (DHFL), which is worth nearly ₹35,000 crore. The fraud was allegedly carried out by the Wadhawan brothers, Kapil and Dheeraj, who ran DHFL. The charge sheet also exonerates 49 other companies that were originally named as accused in the case.

According to the CBI, Alok Kumar Misra allegedly received a benefit of ₹1.5 crore from DHFL in the form of a discounted flat for his son in Mumbai. This benefit was allegedly given to him in exchange for sanctioning loans in his capacity as the head of BOI and OBC. Misra served as the CMD of BOI from 2009 to 2012 and OBC from 2007 to 2009.

The CBI’s investigation revealed that between January 2010 and December 2019, a consortium of 17 banks extended credit facilities worth ₹42,871 crore to DHFL. The Wadhawan brothers allegedly siphoned off the funds to shell companies known as ‘Bandra Book Entities,’ causing a loss of ₹34,926 crore to the consortium. 

The charge sheet also names other companies and individuals who helped the Wadhawan brothers divert funds.

It is important to note that the charge sheet against Alok Kumar Misra was filed after obtaining sanction under section 17A of the Prevention of Corruption Act, which is mandatory for investigating a public servant. However, a sanction under section 19 of the PC Act, which is mandatory for prosecuting a public servant, is still pending.

The charge sheet was taken cognizance of by a Delhi court on April 27.

During its investigation, the CBI found that out of the 131 companies originally named in the first information report (FIR) filed in June 2022, 49 companies were “genuine” borrowers without any bad intentions. These companies had entered into actual loan transactions with DHFL, following the necessary procedures and guidelines set by the Reserve Bank of India (RBI). 

The court has exonerated these companies from any criminal liability based on the CBI’s findings. The CBI has identified genuine loan transactions worth ₹13,425 crore, out of which ₹5,836 crore has already been repaid by these 49 companies to DHFL or the Resolution Professional.

The CBI has filed 2,70,000 pages of fresh documentary evidence in 20 trunks in the court, along with a list of 521 new witnesses to support its case against the accused.

It is worth mentioning that Alok Kumar Misra has held several high-level positions in the banking sector, including the chairman and managing director of Bank of India and Oriental Bank of Commerce.

The ownership of DHFL has changed since the bank fraud case came to light, as it was taken over and sold under India’s bankruptcy code.

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Police summons MDs of 4 Banks, 11 Bank Employees arrested

A number of bankers have been arrested in recent cyber fraud investigations due to allegations that they were involved in fraudulent operations. The managing directors of Yes Bank, ICICI Bank, RBL Bank, and Kotak Mahindra Bank are among the four private banks that the city police have written to, demonstrating how seriously they regard this issue. The letter's objective is to ask them to come in person the next week to provide an explanation for why no legal action should be taken against them.

Role of Bankers in Cyber Fraud Cases

When authorities discovered that the account holders implicated in illegal activities were unaware that they had opened such accounts, the role of bankers came under investigation. It was found that the bankers had helped cyber criminals open these accounts after more inquiry. The fact that the bankers charged a sizable commission in each instance suggests that they were aware that they were involved in illegal activity.

Victims of Fraudulent Investment and Task-based Schemes

Many people have been duped by schemes that promise large returns on investments or possibilities depending on tasks. In addition to apprehending the cyber criminals, the local police have shown initiative by making the bankers answerable for their involvement in these cyber fraud cases. As a result, the city police are the only law enforcement agency in the nation authorized to detain bankers in conjunction with other suspects in similar circumstances.

Read More - सबसे बड़ा बैंकिंग घोटाला: भारत देश में अब तक का सबसे बड़ा बैंक फ्रॉड, करोडो का बैंको को लगाया चुना

Exposing the Role of Bankers

During the investigation, it was discovered that the employees of Kotak Mahindra Bank’s MG Road branch were involved in fraudulent activities. They were subsequently arrested, and during the interrogation, they confessed to the involvement of several other bankers in similar fraudulent acts. Recognizing that bank accounts are a crucial component in cyber frauds, the police decided to investigate the criminal activities of bankers in such cases.

Violations of KYC Norms

In light of the recent arrests, the city police have written to the managing directors of Kotak Mahindra Bank, ICICI Bank, RBL Bank, and Yes Bank. The purpose of this letter is to request their personal appearance and an explanation as to why legal action should not be initiated against them for clear violations of the Reserve Bank of India’s (RBI) Know Your Customer (KYC) norms.

Bankers’ Methods and Tactics

During the ongoing investigations, the police have found that the bankers accused of aiding cyber criminals opened bank accounts using identification and address proofs collected from factory workers and laborers. They even gained access to the bank accounts of daily-wage workers by offering them money. Additionally, the police noticed the use of fake IDs, address proofs, and forged signatures to open bank accounts, further exposing the deceptive tactics used by these individuals.

Read More - Suspicious transactions detected in this bank,three staffs arrested

Bank Responsibilities and Accountability

The Deputy Commissioner of Police(Cyber Crime), Siddhant Jain, emphasized that bank managements have a responsibility to safeguard their clients’ money and protect it from cyber criminals. If bank employees are involved in criminal activities and aiding fraudsters, it is the duty of the bank managements to explain why action should not be taken against them. The police are determined to hold the responsible parties accountable for their actions in order to protect the public and maintain the integrity of the banking system.

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MD, CEO and Head of Banks in India (Updated)

We are sharing with you the List of Important Office Holders, Bank CEO and MD’s Name in India. It will help you in upcoming IBPS,SSC and other competitive exams.

Nationalised Banks

--> State Bank of India (SBI)–Shri Dinesh kumar Khara (Chairman)
--> Bank of Baroda (BoB)–Shri Sanjiv Chadha (MD & CEO)

--> Bank of India (BoI)–Shri Rajneesh Karnatak (MD & CEO)
--> Bank of Maharashtra (BoM)–Shri A S Rajeev (MD & CEO)
--> Canara Bank– Shri K Satyanarayana Raju (MD & CEO)
--> Central Bank of India–Shri Matam Venkata Rao (MD & CEO)
--> Indian Bank–Shri Shantilal Jain (MD & CEO)
--> India Post Payment Bank (IPPB)- Shri  J Venkatramu (MD & CEO)
--> Indian Overseas Bank (IOB)–Shri Ajay Kumar Srivastava (MD & CEO)
--> Punjab and Sind Bank–Shri Swarup Kumar Saha (MD & CEO)
--> Punjab National Bank (PNB)–Shri Atul kumar Goel (MD & CEO)
--> UCO Bank–Shri Soma Sankara Prasad (MD & CEO)
--> Union Bank of India–Ms. A. Manimekhalai (MD & CEO)

Private Banks

-->  Axis Bank–Shri Amitabh Chaudhry (MD & CEO)
-->  AU Small Finance Bank –Shri Sanjay Agarwal (MD & CEO)
-->  Bandhan Bank–Shri Chandra Shekhar Ghosh (MD & CEO)
--> Catholic Syrian Bank–Shri C. V. R. Rajendran (MD & CEO)
--> City Union Bank–Dr. N. Kamakodi (MD & CEO)
--> Development Credit Bank (DCB)–Shri Murali M. Natrajan (MD & CEO)
--> Dhanlaxmi Bank– Shri J K Shivan (MD & CEO)
--> Equitas Small Finance Bank - Shri Vasudevan P. N. (MD & CEO)
--> Federal Bank–Shri Shyam Srinivasan (MD & CEO)
--> Fincare Small Finance Bank–Shri Rajeev Yadav (MD & CEO)
--> HDFC Bank–Shri Sashidhar Jagdishan (MD & CEO)
--> ICICI Bank– Shri Sandeep Bakhshi (MD & CEO)
--> IDBI Bank Ltd–Shri Rakesh Sharma (MD & CEO)
--> IDFC First Bank–Shri V Vaidyanathan (MD & CEO)
--> IndusInd Bank–Shri Sumant Kathpalia (MD & CEO)
--> Jammu & Kashmir Bank–Shri Baldev Prakash (MD & CEO)
--> Karnataka Bank–Shri Mahabaleshwara M. S. (MD & CEO)
--> Karur Vysya Bank–Shri B Ramesh Babu (MD & CEO)
--> Kotak Mahindra Bank–Shri Ashok Vaswani (MD & CEO)
--> Lakshmi Vilas Bank–Shri Subramanian Sundar (MD & CEO)
--> Nainital Bank–Shri Dinesh Pant (Chairman and CEO)
--> RBL Bank–Shri R Subramaniakumar (MD & CEO)
--> South Indian Bank–Shri Murali Ramakrishnan (MD & CEO)

--> Suryoday Small Finance Bank-- Shri R. Baskar Babu (MD & CEO)
--> Tamilnad Mercantile Bank– Shri Thiru K.V. Rama Moorthy (MD & CEO)
--> Ujjivan Small Finance Bank–Shri Ittira Davis (MD & CEO)
--> Yes Bank –Shri Prashant Kumar (MD & CEO)

Last Updated on Oct, 2023

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FM Nirmala Sitharaman to meet chiefs of PSU Banks today; here's what's on agenda

 

Finance minister Niramala Sitharaman on 25 March will meet managing directors of public sector banks (PSBs) in order to review performance against the backdrop of the failure of a few banks in the US and the liquidity crisis faced by Credit Suisse.

Sources told news agency PTI that the meeting is going to take stock of the progress made by banks in achieving targets set for the various government schemes including: Kisan Credit Card (KCC), Stand-Up India, Pradhan Mantri Mudra Yojana (PMMY), emergency credit line guarantee scheme (ECLGS) to help businesses affected by COVID-19.

This will be the first full review meeting after the presentation of Union Budget 2023-24 on 1 February. The banks would also be asked to focus on the areas highlighted by the Budget, including credit flow to productive sectors.

Sources further added that the finance minister will review financial inclusion, credit growth, asset quality, and capital raising and business growth plan of banks for the next financial year. Discussion will also be held on non-performing assets (NPAs) of ₹100 crore and the recovery status.

This meeting comes against the backdrop of global concern over the failure of banks due to aggressive monetary tightening.

The US Fed on Wednesday hiked interest rates by 25 basis points to tame high inflation despite the banking crisis. To fight the persistent hot inflation, the Fed has so far increased rates from zero to 4.75 to 5 per cent, all in just one year.

Taking a cue, both, the Bank of England and the European Central Bank (ECB) have also raised their benchmark interest rates.

Meanwhile, policymakers and experts have said that the Indian banking system is in good shape and can handle the situation caused due to monetary tightening.

Various reforms undertaken by the government have resulted in significant improvement in the asset quality of public sector banks, with the gross NPA ratio declining from the peak of 14.6 per cent in March 2018 to 5.53 per cent in December 2022.

All PSBs are in profit with an aggregate profit of ₹66,543 crore in 2021-22, and that further increased to ₹70,167 crore in the first nine months of the current financial year.

At the same time, resilience has increased with the provision coverage ratio of PSBs rising from 46 per cent to 89.9 per cent in December 2022. The capital adequacy ratio of PSBs improved significantly from 11.5 per cent in March 2015 to 14.5 per cent in December 2022.

The total market capitalisation of PSBs (excluding IDBI Bank, which was categorised as a private sector bank in January 2019) increased from ₹4.52 lakh crore in March 2018 to ₹10.63 lakh crore in December 2022, he said.

The government implemented a comprehensive 4R strategy of Recognising NPAs transparently, Resolution and recovery, Recapitalising PSBs, and Reforms in the financial ecosystem.

Major banking reforms undertaken by the government over the last eight years ensured credit discipline, responsible lending and improved governance, besides the adoption of technology, amalgamation of banks, and maintaining general confidence of bankers.

Yesterday, the Lok Sabha passed the Finance Bill, 2023 with some amendments. Union Finance Minister Nirmala Sitharaman tabled ‘The Finance Bill, 2023’ in the lower house amid sloganeering by Opposition MPs demanding a JPC inquiry into the Adani Group issue. She introduced 64 official amendments to the Finance Bill which was tabled in Parliament on February 1 along with the Budget proposals. 

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Govt appoints new MD & CEO of PNB

S S Mallikarjuna Rao was on Tuesday appointed the Managing Director and Chief Executive Officer of Punjab National Bank, an official order said.

Rao, 57, currently the Managing Director and Chief Executive Officer of Allahabad Bank, has been appointed to the new post up to September 18, 2021.

"The Appointments Committee of the Cabinet (ACC) has approved the proposal of the Department of Financial Services for posting of Ch. S. S. Mallikarjuna Rao, Managing Director and Chief Executive Officer in Allahabad Bank as Managing Director and Chief Executive Officer in Punjab National Bank, with effect from the date of assumption of office, till 18.09.2021 or until further orders, whichever is earlier," the order said.

The government in August merged United Bank of India and Oriental Bank of Commerce with Punjab National Bank, making the proposed entity the second largest public sector bank (PSB).

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Yes Bank find new CEO to replace Rana Kapoor

Ranveet Singh Gill, the veteran banker has been appointed as the new MD and CEO of Yes Bank.

Yes, Bank also received approval from RBI for the tenure of its current MD&CEO till January 31, 2019, and for appointing a successor by February 01, 2019.

Yes, Bank said in a statement, “The Bank has received RBI approval for its new MD & CEO, Mr Ravneet Singh Gill for him to join on or before March 1, 2019."

Mr Gill, currently the chief of Deutsche Bank’s India operations, will replace Rana Kapoor. Gill joined Deutsche Bank in 1991 and has worked across different businesses including corporate banking, capital markets and wealth management.

In September last year, RBI had asked Rana Kapoor, Managing Director & CEO of Yes Bank, to step down by the end of January, sending its stock plunging and causing several resignations from its board. The central bank had asked the lender to find a new CEO by February 1.

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New MD & CEO of Corporation Bank

P V Bharathi has been appointed as managing director and chief executive officer of the Corporation Bank, according to an order issued by the Personnel Ministry on December 24.

Bharathi is at present Executive Director, Canara Bank.

She will take over the charge on or after February 1, 2019 and remain in the post till March 31, 2020 - the date of her superannuation, the order said.

In another order, the ministry said Birupaksha Mishra and Balakrishna Alse S have been appointed as executive director in the Corporation Bank and the Oriental Bank of Commerce, respectively.

Mishra is General Manager, Central Bank of India. Balakrishna is GM, Corporation Bank.

K Ramachandran has been appointed as executive director of the Allahabad Bank. He is at present General Manager, Corporation Bank.

Ramachandaran will hold the office up to the date of his superannuation which is June 30, 2021.

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Bank of Maharashtra appoints new MD, CEO

State-owned Bank of Maharashtra Sunday announced that A S Rajeev has joined the lender as its Managing Director & Chief Executive Officer. 

"A S Rajeev has joined Bank of Maharashtra as Managing Director & Chief Executive Officer on 2nd December 2018. Prior to this, he was Executive Director of Indian Bank from 22 January 2016," the lender said in a release. 

Rajeev is having about three decades of professional experience in three Banks - Syndicate Bank, Vijaya Bank and Indian Bank. 

A qualified Chartered Accountant, he has vast exposure and expertise in all important areas of banking, including corporate credit, international banking, treasury, risk management, credit monitoring & supervision, NPA management, planning & development, human resources, finance, accounts & taxation among others. 

He is a mathematics graduate with professional qualifications of FCA, MBA, DISA and CAIIB, the bank said. 

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