According to Central Bureau of Investigation (CBI) officials, the Hapur-based Simbhaoli Sugars Ltd in 2011 fraudulently diverted funds received as loans for sugarcane farmers and self help groups. Acting on complaints by three different banks, the investigative agency has registered three cases of financial fraud within a week against a jeweller, a businessman, and a public servant.
The CBI on Sunday registered a bank fraud cases against a Uttar Pradesh based private sugar company, its top officials along with unknown bank officials for allegedly causing loss of Rs 109 crore to Oriental Bank of Commerce, officials said.
The FIR states that the OBC had sanctioned the loan in 2011 under a Reserve Bank of India (RBI) scheme for the objective of financing to 5,762 sugarcane farmers supplying sugar produce to the company from January 25, 2012, to March 13, 2012.
"The borrowers were utilising this facility for discounting of bills, under letters of credit established by Dubai Bank Kenya, Soleil Chartered Bank, Trade Chartered Bank, TF Bank Kontrakt Inc, Century Bank Corp LCC, etc", OBC said in its complaint.
The process continued till the OBC noticed that these banks were poorly rated and that the exposure was getting on the higher side. The second loan was declared NPA (non-performing asset) on November 29, 2016, almost three weeks after demonetisation of Rs 1,000 and Rs 500 notes was announced.
According to the FIR, the bank filed the complaint on November 17, 2017. "The account was later declared as alleged fraud by the bank to RBI on May 13, 2015 for an amount of Rs 97.85 crore", stated the FIR, a copy of which was reviewed by Mint. This is similar to the modus operandi of absconding diamantaire Nirav Modi who defrauded Punjab National Bank (PNB) of Rs 11,400 crore.
But, after the loans turned into NPAs, the actual market value of the properties were found to be only Rs 2.5 crore.
In a bid to recover the dues, the bank had also approached the buyers, including Devi Jewells, Mannat FZE and PlatDiam International, but without any success. They then went missing, prompting banks to move the Debt Recovery Tribunal and also got some collateral assets liquidated.