ABG Shipyard Ltd and its proprietors have been charged with defrauding banks of Rs 228.42 billion ($3.03 billion) by India’s government investigating agency.
ABG Shipyard Fraud Case:
A forensic inspection report it got from the banks two years ago showed instances of fraud in April 2012 and July 2017, according to the report, which was uploaded on the Central Bureau of Investigation’s site.
ABG Shipyard can not be contacted for comment and did not react to an email sent to them right away. The shipbuilder, one of India’s “dirty twelve” extremely indebted enterprises by the central bank, has gone into bankruptcy.
The business owes
- Rs 70.89 billion to ICICI Bank,
- Rs 36.34 billion to IDBI Bank,
- Rs 29.25 billion to the State Bank of India,
- Rs 16.14 billion to Bank of Baroda, and
- Rs 12.4 billion to Bank of Baroda,
according to statistics from the forensic audit included with the CBI case.
The forensic audit was filed with the CBI by the State Bank of India, which handled ABG Shipyard’s finances. The fraud took the form of diversion of money,
“misappropriation and criminal breach of trust with a purpose to benefit unlawfully at the cost of the Bank’s finances,” according to the report, which was included in the CBI complaint filed on Sunday.
It stated that “the money was utilized for purposes different than those for which the funds were provided by the Bank.” 75.3188 Indian rupees = $1.
Finance Minister Nirmala Sitharaman has said the Opposition had placed its foot on the metaphorical ax by making a ruckus over ABG Shipyard’s worst banking fraud of Rs 22,842 crore, underlining that the account had become a nonperforming asset (NPA) in November 2013, while the UPA was in office.
The minister credited the banks for identifying the fraud in the ABG Shipyard sooner than the usual time required in such cases, saying that while it generally takes 52 to 56 months to uncover such bank frauds, it took less time to notice it take action under the current government.
Reassuring depositors that the banks’ general health has improved and that they have turned the corner, Ms. Sitharaman outlined the course of events in the ABG Shipyard issue after the account was labeled a nonperforming asset (NPA) by the banks in late 2013.
She said the consortium of banks, led by those with significant exposures, including the State Bank of India (SBI) and ICICI, had worked out a debt restructure as is standard procedure for any stressed account.
According to sources close to the investigation, the Central Bureau of Investigation (CBI) would focus on the suspected involvement of “public personnel” in the country’s largest bank fraud involving ABG Shipyard.
Last Monday, the national agency charged ABG Shipyard, its directors Rishi Kamlesh Agarwal, Santhanam Muthaswamy, Ashwani Kumar, and others, including “unnamed public officers,” with defrauding a 28-member bank consortium for Rs 22,842 crore.
The complaint has been filed on counts of official misconduct, criminal conspiracy, cheating, and criminal breach of trust. According to the FIR obtained by ET, the alleged crime took place between 2012 and 2017.
Top bank executives, such as the chairman, directors, auditors, managers, and staff, are considered public servants under the legislation.
Their probable involvement is significant since the complainant bank, a Mumbai branch of State Bank of India, notified the CBI in its complaint that it did not believe its employees of being involved in the scam.
Edited By- Subbuthai Padma
Published By- Satheesh Kumar