india

Updated: Oct 05, 2019 23:46 IST

Mumbai :Mumbai police’s economic offences wing (EOW) on Saturday arrested the former chairman of Punjab and Maharashtra Cooperative (PMC) Bank on Saturday in connection with financial irregularities at the bank to the tune of Rs.4,355 crore.

Singh was arrested in the evening after he surrendered before the EOW, to which he had written a letter first about his intention to give himself up, officials said. He is the fourth person arrested by EOW in connection with the fraud at PMC Bank, after Housing Development and Infrastructure Ltd (HDIL) executive chairman Rakesh Wadhwan, his son Sarang Wadhwan and PMC Bank’s suspended managing director Joy Thomas.

A court on Saturday remandedThomas in police custody until October 17 Public prosecutor Rajkumar Machewar argued that Thomas was a key person involved in the fraud at PMC Bank . “The probe is at a very initial stage,” he said, seeking the remand. The bank had granted loans first on collateral that was pledged much later, he said.

Defence lawyer Rakesh Singh objected to the allegation. Singh said Thomas hadn’t been the decision maker but had been made a scapegoat.

“The loans were secured and the security against the loan is more than 2.5 times, so the allegation about loan being unsecured is false. He has nothing to gain unlawfully nor has the bank lost anything,” Singh argued.

The EOW registered a first information report (FIR) on Monday against senior officials of HDIL and PMC Bank in the case. Rakesh and Sarang Wadhawav are n police custody until October 9.The Enforcement Directorate (ED) registered a money laundering case against the Wadhwans on Friday. Premises of the suspects have been raided by the authorities and searches conducted.

“We are recording bank officials’ statements and will conduct a probe pertaining to documents seized during searches. We’re also awaiting initial reports from forensic auditor. The exact amount of loans will be known after the report,” an EOW officer said

The ED on Saturday also attached a private jet belonging to the Wadhawans in the case.

The EOW probe has so far revealed 44 suspicious accounts allegedly linked to HDIL that were masked by tampering with bank software. Only a chosen few employees – allegedly close to Thomas – knew of these bank accounts, EOW officers said on Thursday requesting anonymity.

Over 73% of the bank’s loan books were made the now-bankrupt HDIL group and all of it is not being serviced. PMC Bank is accused of hiding information on the loans from the banking regulator, Reserve Bank of India, from 2008 to 2019. PMC Bank has 137 branches and over ₹11,000 crore in deposits.