4 arrested for mortgage rip-off in Kerala co-operative financial institution

KERALA POLICE’S financial offences wing on Sunday arrested 4 functionaries of a CPI(M)-controlled co-operative financial institution in Thrissur district, the place a mortgage rip-off of a minimum of Rs 104 crore was detected final week.
The arrested embrace the secretary, supervisor, chief accountant and a fee agent of Karuvannur Co-operative Bank.
The police additionally carried out searches on the premises of these arrested in addition to at properties of two absconding workers of the Karuvannur-based financial institution, and seized paperwork pertaining to the unlawful loans. All the accused are CPI (M) members, who had been sacked from the occasion after the rip-off was unearthed on July 19.
The opposition Congress and BJP, which have focused the ruling occasion within the state over the problem, have alleged that the mortgage rip-off is to the tune of Rs 300 crore. State Cooperation Minister V N Vasavan, nevertheless, stated that an inside inquiry has revealed monetary fraud of Rs 104.37 crore.
The authorities has additionally dissolved the financial institution’s governing physique, run by CPI(M) for the previous 40 years, and introduced it beneath the administrator.
Vasavan stated there was no lapse on the a part of the federal government. “When the anomalies came to notice, we suspended the officials concerned and ordered a probe. Civil and criminal proceedings have been initiated. We have nothing to hide,” he stated.
According to the minister, the accused diverted the loans to accounts created in faux addresses and manipulations within the banking software program. Those behind the fraud could be dropped at e book, he stated.
The accused financial institution functionaries allegedly siphoned off crores of rupees to some firms, together with two tourism ventures, which did not take off in the course of the lockdown. The accused had been themselves promoters of the tasks.

In one occasion, sources stated, greater than 100 mortgage accounts had been allegedly created beneath fictitious names and Rs 50 lakh every had been credited to the accounts. It is suspected that accused financial institution workers cast the addresses and paperwork to pocket Rs 50 crore on this method. Many every day wage employees, who had utilized for financial institution loans, by no means received the quantity credited of their accounts, however received restoration notices for defaulting on mortgage reimbursement.
In such dealings, the financial institution didn’t go for any collateral, the sources stated.
In some instances, loans had been sanctioned to even those that had not utilized for it. The ceiling on loans on the cooperative financial institution was flouted to allot large quantities to benami accounts of the financial institution officers and native CPI(M) leaders, it’s alleged.

BJP state secretary N Nagesh stated the financial institution allotted large loans illegally with out guaranteeing collateral safety. “There were middlemen at the bank to facilitate loans. For huge loans, these middlemen pocketed 10 per cent of the amount as commission. Persons who never applied for loans have been allotted Rs 50 lakh each. The bank officials created fake addresses and accounts to loot the money,” he alleged.
According to knowledge out there, the cooperative financial institution has a deposit of Rs 358 crore and a credit score of Rs 320 crore. A CPI(M) department committee member, Okay Okay Divakaran, has been the financial institution president for the previous 10 years.